NZ property prices up again with more sales and listings, figures show

Residential property prices in New Zealand recovered last month to be close to levels of a year ago, supporting views the economy has emerged from its longest recession in more than 30 years.

Government agency Quotable Value said that the average property price rose 0.7% in September compared to the previous month. Overall its residential house price index fell 1.1% in the 12 months to the end of September, compared with a 2.8% decline the previous month QV said the trend in values has now improved for six months in a row there are signs of more activity in the market with an increase in the number of sales and more listings in many areas.

However the activity is patchy, with some markets much stronger than others, making it harder to estimate national trends, QV spokeswoman Glenda Whitehead said in a statement.

Most of the main centres showed higher values than a year ago, while most of the provincial centres were still below September 2008 prices. ‘The market is still clearly in a state of change. Although there is strong competition among keen buyers in some localities and price brackets for the limited properties available,’ said Whitehead.

House prices in Auckland, the biggest population and commercial centre, were 0.6% higher in September from a year ago, compared with a 1.9% fall in August, while the capital, Wellington, was up 1.1% after a 0.1% drop the month before.

Tauranga is still 1.8% below last year but has improved rapidly over recent months. Hamilton is the only main centre to drop back slightly and is now 0.9% below last year. While values in many provincial centres including Whangarei, New Plymouth and Palmerston North continued to fluctuate in September.

Some experts are expecting the housing market to flatten as Christmas approaches, rather than go higher, as credit growth remains weak. Part of the reason for house price rises had been a lack of listings, with support from low interest rates and net migration inflows, according to a report from ANZ economists.

‘It would be tempting to surmise that rising supply will suppress prices, but it may also be a sign of confidence in the market, ie recent housing market trends are leading to increased confidence from homeowners to test the waters,’ said the Market Focus report.


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