Nationwide residential property values eased slightly in March according to the latest QV index. Despite the slight drop in the last month, values are still up 0.5% over the past three months and 3.0% up over the past year. Values are now 3.0% below the previous market peak of late 2007.
QV.co.nz Research Director, Jonno Ingerson said "the marginal drop in values last month follows a year of slight month on month increases. These increases were driven initially by Auckland and Canterbury but the rest of the main centres have also been increasing over the past few months. It is too early to say if the drop in the latest month represents a change in direction for the market".
Ingerson said "sales activity remained strong in March, returning to the highest levels since 2009. Activity levels have been bolstered by first home buyers having enough confidence to enter the market, while some existing home owners are now ready to make a move they may have been delaying for several years. The level of sales activity is still being constrained by a lack of supply in some areas, particularly Auckland, Christchurch and parts of Wellington."
"The market remains variable across the country, responding to local economic influences. Most of the main centres have been increasing, most of the provincial centres have been more or less stable, and the rural centres have generally been increasing over the past year" Ingerson said.
Values in the wider Auckland area are up 0.8% over the past quarter, and 5.0% up over the past year. This annual increase is more than any of the other main centres and as a result values are now 2.2% above the previous market peak.
In the most recent month values have either steadied or dropped slightly in Rodney, North Shore, old Auckland City, and Manukau, and as a result the wider Auckland area has eased slightly. It is too soon to say if this is the beginning of a changing trend in the market or just a temporary dip.
The old Auckland City remains the fastest growing part of the Auckland Area, up 6.9% over the year and now 4.8% above the 2007 market peak. The Southern part of the old Auckland City within the area from Mt Eden to Waterview to Blockhouse Bay to Penrose has risen 8.8% over the past year and is now 6.1% above the previous market peak.
"Quality properties in good school zones and near the city centre remain in high demand. However there are insufficient properties coming onto the market to meet this demand which is tending to put upward pressure on prices" said QV Valuer Glenda Whitehead.
"In central areas, where zoning will allow, we are starting to see infill housing sites being created, with seemingly good demand for these vacant sections either from spec builders or potential owner/occupiers" said Whitehead.
Across the rest of Auckland values are up 4.4% over the past year in Papakura, 4.2% in Waitakere, 3.8% in North Shore and 3.1% in Manukau. All these areas have risen more in the past year than any of the other main centres apart from Christchurch which has risen 4.1%.