House price falls pick up speed
New data out from QV today shows house price falls picking up pace.
With constraints on credit limiting the number of new buyers who can enter the market, and more houses becoming available for sale, there are more sellers than buyers, which is keeping the pressure on prices, the property research firm says.
Here are five numbers that tell the story of the housing market at present:
3.4%
The average New Zealand home decreased in value by 3.4% in the three months to the end of June. Prices are still up 7.2% year-onyear, but that’s a significant slowdown from the annual rate of even a few months ago.
‘‘Just six months ago the national market was tracking at just under 30% value growth per annum,’’ QV general manager David Nagel said. ‘‘This has fallen back quite dramatically, down to single figures, with further reductions inevitable over the coming months as this home value correction continues.’’
6.6%
Wellington had the biggest house price fall in the country. Prices in the capital, down 6.6% for the quarter, are now lower than they were a year ago. It is the first annual house price decline in the region since 2012.
‘‘The market is continuing in a correction cycle, now showing a relatively consistent negative pattern after a huge value surge last year. Downward price adjustments are being seen from listed properties as seller expectations are correcting to current market levels,’’ said senior property consultant Olivia Betts.
One
Only one of the 16 major areas monitored by QV showed an increase in price over the three months to June.
That was Queenstown-Lakes, where prices increased 1.9% in the quarter.
20.9%
While Christchurch’s prices dropped 1.7% in the three months, the Canterbury region was showing the most resilience, QV said.
Canterbury recorded an average value increase of 20.9% compared with the same time a year ago, a much larger rate of growth than other parts of the country. ‘‘The Canterbury market appears to have reached a turning point, with another month of declining home values,’’ said property consultant Olivia Brownie.
2.5%
Rising interest rates are one of the factors weighing on the property market. The Reserve Bank is tipped to increase the official cash rate next week, probably to 2.5%. This will keep the pressure on, although a growing number of commentators now doubt the rate will need to reach the peak of 4% forecast by the Reserve Bank.