Prices flat but turnover up

Wellington region’s rate of home value growth has flattened – but is still performing better than most of the other main centres.

The latest QV House Price Index shows the region’s average home value increased by just 0.6% to $873,614 throughout the April quarter – a significant reduction on the 2% quarterly growth reported in last month’s index and the 2.5% quarterly growth recorded back in February.

This compares to a 0.7% drop in Auckland over the three months to April.

For the third straight month, Kāpiti Coast saw the largest positive quarterly growth. The district’s average home value went up by 3.3% to $850,000 – with average values in Upper Hutt and Porirua increasing by 2.6% to $766,000, and 1.6% to $838,000 respectively.

The average home value remained steady this quarter in Wellington City at $1,009,000, but was down by 0.5% to $791,000 in Lower Hutt.

While Wellington’s growth was not startling, the number of buyers and sellers in the market had dramatically increased, leading to more listings and more sales.

Agent Craig Lowe, of Lowe & Co, said the flat growth figures were only telling half the story and it felt like the market had returned to some normality after the shock of a dramatic post-Covid drop.

“We’re not feeling prices really moving at all. What we’re feeling is a hell of a lot more stock and more turnover.

“The numbers of houses sold was so significantly up on this time last year.

“People were sitting on their hands, but now they’ve come out of the woodwork to transact.”

QV senior consultant David Cornford said tough economic conditions, high interest rates and job insecurity in the region were affecting the Wellington market.

“Current market conditions are providing first-home buyers with a window of opportunity to enter the market before prices likely start to recover when interest rates are cut – either late this year or early next year, as widely expected.”

Cornford said more stock had come on to the market than was being sold.

“This is giving buyers plenty of choice in what it is now considered a ‘buyers’ market.”

Residential property values have plateaued across New Zealand.

QV House Price Index showed that the average home value increased nationally by just a fraction of a percentage point in the three months to the end of April to $926,772 – a significant slowdown from the 2.2% quarterly home value growth recorded at the end of March.

The national average home value is now 2.7% higher than at the same time last year, but still 12.9% ($136,993) below the market’s peak in late 2021.

QV operations manager James Wilson said what little momentum the housing market still had going into autumn appeared to have all but evaporated now.

“Home value growth has largely stalled across much of the country, reflecting difficult economic conditions that aren’t getting any easier and aren’t likely to any time soon.”

“People were sitting on their hands, but now they've come out of the woodwork to transact.”

Craig Lowe, real estate agent