Media release
9th September
LVR caps unlikely to have a slow down property values
The latest monthly property value index shows that nationwide residential values continued to increase in August. Values
have increased 8.5% over the past year, with an increase of 2.9% over the past three months. Values are now up 8.3% over
the previous market peak of late 2007.
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Jonno Ingerson, QV.co.nz Research Director said “Auckland and Canterbury are still driving the national increase in
values, with the other main cities seeing limited growth. The provincial centres have tended to be more variable,
although for much of the year many have been slowly increasing. In the last couple of months however values have
flattened or even declined in many provincial areas. It is not yet clear if that is likely to continue or was just a
temporary slowdown.”
“The LVR speed limits imposed by the Reserve Bank were in part put in place to slow down the rapid growth in property
values. They will definitely limit the number of first home buyers and investors who will usually require loans of more
than 80% of the property's value. However the rapid increase in values in Auckland and Canterbury in particular is also
due to a lack of supply rather than just high demand from potential buyers. So while the LVR limits may have some
dampening effect on values, we should still expect them to increase for some time yet.”
Auckland
Values across Auckland are still increasing strongly. We have seen the highest increases recently in old Auckland City,
Waitakere and North Shore; however, Manukau has also crept up again, with all four areas having increased around between
3.3-3.6% over the past three months.
Some areas within those cities have increased even further, with the North Shore Onewa area having increased 5.1% over
the past three months and the eastern area of Auckland City having increased 5%. In stark contrast, Auckland City
Central hasn’t grown as fast, with only a 1% over the past three months.
Overall, values across Auckland are 13.1% above last year, with Waitakere and North Shore seeing the highest annual
increases, both above 14%. Auckland City is close behind at 13.8%. Again, some areas such as North Shore Onewa and
Auckland City South are leading the way, sitting above 15%.
QV Valuer Bruce Wiggins said “Activity is still good, especially in suburbs close to the CBD and out West such as
Blockhouse Bay. There also appears to be good demand from baby boomers especially for quality apartments in the city. We
are however, seeing some negative sentiments surrounding leasehold properties, with buyers prepared to walk away in some
instances in light of large ground rental increases.”
Hamilton and Tauranga
Hamilton values are still up, but growth is flattening compared to earlier in the year. Values are up 0.9% over the past
three months, and 3.9% over the past year.
QV Valuer Richard Allen said “We are increasingly seeing buyers showing little interest in properties below $340,000,
with first home buyers even setting their expectations higher than what we have seen in the past.”
Tauranga remains variable, with values currently 0.8% above this time last year, thanks to a slight lift over the past
three months of 0.8%.
Wellington
Growth in the Wellington area is still limited, with some areas experiencing a small decrease in value over the past
three months. Lower Hutt and Upper Hutt have seen increases just over 1% over the past three months, whereas Wellington
City has remained the same and Porirua is down 0.4%. Overall, Wellington is up 2.8% over last year.
On closer inspection, Wellington City East has slowed down the most at -1.9% over the past three months, with all
surrounding areas seeing very slight increases.
QV Valuer Kerry Buckeridge said “The market has been pretty flat, although there is reasonable competition and good
prices still being paid for desirable properties. Due to Wellingtonians typically not listing over winter there is a
lack of properties on the market. This is benefiting the properties that are listed, as they are facing less competition
and attracting good prices.”
Christchurch and Dunedin
Christchurch values are still tracking well, with the annual increase sitting at 11.4%. There has been a 2.7% increase
over the past three months in general for the city, however there are variances throughout the city. Values in Banks
Peninsula have decreased over the past three months, at -2.1%, whereas on the other end of the scale the Southwest area
has seen the highest increase at 3.7%.
QV Valuer Daryl Taggart said “Buyers are being cautious and not necessarily rushing in as they might have been
previously. They appear to be waiting and looking out for good quality properties instead.”
Dunedin has continued to show limited gains in the back end of the year. Values have increased 0.3% over the past three
months, leaving it 3.4% above last year.
Provincial centres
The provincial centres aren’t seeing as much growth as the main centres, however most areas are still up on last year.
Whangerei, Taupo, Rotorua and Gisborne are all still up, although Whangerei has seen the most annual growth with 1.7%.
Hastings and Napier have both dropped back over the past three months, as has Masterton and South Wairarapa. Carterton
is the only areas in the Wairarapa to see any growth over the past three months at 2.2%, ensuring it is up 5.9%
annually.
In the South Island, Nelson, Marlborough, Kaikoura and Queenstown are all up over 4% annually, although Kaikoura has
seen a 3.3% drop over the past three months. Southland and Gore have some of the most noticeable drops, each seeing a
decline over 4% over the past three months.
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