Property market continues to ease

Media release
6th June 2008

Embargoed to 11.59pm Sunday, 8 June 2008
Property market continues to ease

QV's May statistics for the residential property market report a 2.4% growth in national property values over the past year (calculated over the three months ending May 2008 in comparison to the same period last year), down on the 4.9% growth reported in April. The average New Zealand sale price decreased slightly to $387,299.

“While most areas are still holding their value from a year ago, some areas are beginning to report small declines” said Mark Dow of QV Valuations. “Whether properties are holding their value or being sold beneath previous expectations is being influenced by how much pressure the owner feels to sell. There are increasing reports that where sellers aren’t under financial pressure or needing to relocate, they are choosing to take their properties off the market or rent them out rather than accept lower offers. Both our preliminary statistics, and feedback from our valuers in the field, suggest that this decline is set to continue for some time yet” said Mr Dow.

“Buyers have a luxury they haven’t experienced for a number of years where there is far less pressure to make a quick purchase decision. Buyers can now benefit more than ever from doing their research in order to make the most informed decision possible” said Mr Dow.

Annual growth has continued to slow in all the main urban centres. Across the Auckland area property values are 1.8% above the same time last year, down from the 4.7% reported last month. Hamilton City’s annual growth has eased from 2.3% to 0.5% and Tauranga from 3.5% to 1.1%. Wellington area’s growth of 3.7% is the highest of the main urban centres. Christchurch is showing 1.9% annual growth, while Dunedin remains the only main centre to show annual property values less than the same time last year at -2.2%.

Most of the main provincial centres are showing annual growth rates less than those reported last month. The exception is Wanganui which increased slightly to (2.1%). Whangarei (2.2%), Rotorua (3.3%) and Nelson (1.2%) all eased back. Gisborne (-1.1%), New Plymouth (-1.8%) and Palmerston North (-0.3%) are now showing lower values than the same time last year. Queenstown lost the gains of the previous two months in dropping 6.3% to 1.1% annual growth. Invercargill again remains the city with the highest annual growth rate, now 15.3%.

ENDS

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