Residential property prices in New Zealand have recovered well and are now just under prices at the peak of the market in 2007, the latest figures show.
Nationally prices increased 1.2% in October, according to the data from QV’s residential index. It means that nationally prices are 4.4% off peak. But in Auckland they are just 0.1% below peak.
Auckland Area values have increased 2.7% year on year. Values in old Auckland City have increased 3.8% and are now 1.6% higher than peak while across the rest of the Auckland area values have increased in Papakura and Franklin but dropped slightly in Rodney.
After declining for the first half of 2011, values in the Wellington area have started to rise again and are only 0.9% below last year and 7.3% below the market peak.
Christchurch values continue to increase due to demand for undamaged houses, particularly in the Northern and Western suburbs. Values are now 3.4% above last year and only 2% below the market peak. The areas surrounding Canterbury have also been increasing in value since the start of 2011, with Waimakariri up 5.4% and Selwyn District up 4.9% since January.
While values in Dunedin have been volatile over recent months they are currently about equal with where they started the year, but 2.4% below the same time last year and 6.8% below peak.
‘While there has been a slight increase in new listings in many areas, this has yet to translate into an increase in the number of sales. However looking back over the past 20 years while sales generally pick up in October and November, that trend has been largely absent in the last few years, with any increases tending to be in February and March,’ said QV research director Jonno Ingerson.
The index also shows an increase in values in the last month for most of the provincial centres in a further sign that values are rallying across the country. But despite these recent increases values remain below last year in most towns with Wanganui down 5.3% and New Plymouth down 3%. Gisborne and Palmerston North are both 0.3% above last year while Nelson is 1.9% up following six months of gradual increases.
‘The raw underlying data show values have continued to increase and the index next month is likely to once again show the upward trend we have seen in recent months,’ added Ingerson.
Commenting on the Auckland figures, QV senior valuer Glenda Whitehead said October and November could be a turning point in the market. Selling periods appeared to be shortening and prices in many suburbs were rising, although activity was patchy.
She said that competition for Auckland properties could be fierce, particularly in areas close to the city centre.
The latest Bank of New Zealand/Real Estate Institute of NZ residential market survey also shows a rising market. BNZ chief economist Tony Alexander said that overall, the housing market was moving up, but the survey showed a rise in the number of vendors wanting to make a sale.
‘Things have moved from broadly neutral to being more of a buyers’ market. But there is also strongly rising buyer interest from first-home buyers, but not from investors,’ he added.