Prices growing, but more slowly: QV

Property prices continued to rise last month, QV statistics show, but there are some signs that the pace may be slowing – possibly because banks are preparing for loan-to-value restrictions.

Thursday, August 8th 2013, 12:00AM

by The Landlord

Its latest data shows that nationwide residential prices increased 8.1% in the year to July, and 3.1% over the past three months. Prices are now 7.5% up on what they were in late 2007, the last market peak.

Operations manager Kerry Stewart said: “Values continue to rise, although still primarily driven by Auckland and Christchurch. Most of the rest of the main centres are also increasing but at a much slower rate. Many of the provincial towns had previously started to see some small gains; however values have dropped over the last month.”

He said the slowdown since May was more than a normal winter drop-off. “This appears to be due a decrease in sales activity and a decrease in home loan approvals. The latter is due to many main banks already tightening their lending policy in anticipation of policy changes from the reserve bank.”

Auckland prices are still increasing, especially in old Auckland City, Waitakere and the North Shore. All three reported a price rise of more than 4%, leading to a 4.1% increase in Auckland region as a whole.

But Auckland City Central only increased 2.1% over the last three months compared to the surrounding areas like Auckland City South, which has seen a 5.3% increase, and Auckland City East, with a 4.9% increase.

Auckland prices are 12.8% above last year. The biggest increase is out west, where prices are now 13.8% higher than they were the same time last year. Auckland City and North Shore are close behind at 13.6% and 13.5% respectively.

QV Operations Manager Kerry Stewart said: “There is patchy growth across the city with central Auckland generally flat. There is a ring of price movement around 5km to 10km out of this area, but as you move further out of the city values are generally flat also. Once you move out of the central area, commute times, for example, become a deterrent. However, we are still seeing good money being paid for normally average listings due to the lack of stock.”

Growth in Hamilton is still occurring, but it has started to falter somewhat over the winter period. Values are up 0.6% over the last three months, and 3.8% over the past year.

Wellington prices are still showing small signs of growth. Values are 2.8% above this time last year with a 0.7% growth in the last 3 months.

Christchurch values have once again risen, although increases here aren’t quite as high as some of the areas in Auckland. Christchurch has seen a 3.4% increase over the past three months, leaving it sitting at 10.8% over the past year.

QV valuer Jonathon Dix said: “Momentum in the market is continuing with sales being recorded in all sale sectors. We are seeing first-home buyers trying to get into the market in the $500,000 and under bracket, especially before the changes to the bank’s lending requirements come into play.”

Dunedin initially saw some gains this year, but has dropped back recently.

Provincial centres are patchy but mostly up on last year.

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