Rapid growth on West Coast, ‘flat’ elsewhere
House prices are still rising on the West Coast, but are slowing in Canterbury as the cost of living and rising interest rates bite homeowners.
According to the latest QV House Price Index, residential property values increased just 1.4% in Canterbury this quarter.
QV registered valuer Rod Thornton said interest rates and increasing living costs were potentially affecting house values.
“While we cannot absolutely predict what the next few months will bring, signs are there may be some further slowing of the market and downward pressure on values.”
In Christchurch, the average home value increased by 1.5% to $763,993 this quarter.
Compared to the same time last year, the average Christchurch home was worth 3.1% more.
Selwyn recorded an average quarterly increase of 0.6% and an average value of $834,522. Growth in Waimakariri has also levelled out at 0.2% for the quarter and an average value of $714,072.
The West Coast’s property values continued to grow at a relatively rapid rate in Buller and Grey though.
While there were low sales volumes in those districts, the average home value this quarter rose 7.4% in Buller (to $371,150) and 7.8% in Grey ($419,044) , while Westland had more muted growth of 1.5% ($448,026).
QV operations manager James Wilson said residential property values were gently rising and falling throughout the first quarter of 2024, amid a glut of listings and an ongoing dearth of sales across much of New Zealand.
“‘Flat’ remains the word of the year so far when it comes to the current state of New Zealand’s residential property market,” he said. “We’re seeing only modest movement across the nation – mostly up, but some down – which is a fair reflection of a housing market that is continuing to find its footing again amidst some pretty strong economic headwinds.”
The latest QV House Price Index shows the average home value has increased nationally by 2.2% to $924,734 over the first three months of 2024. The average home value is now 1.9% higher than the same time last year, but 13.1% below the market’s peak in late 2021.
Of the main urban areas QV monitored, Queenstown experienced the most growth this quarter at 2.7%.
Just three main urban areas recorded more growth this quarter – New Plymouth (up 2.1%), Palmerston North (0.6%) and Invercargill (0.7%).
“Immigration is helping to fuel demand, so it’s still unlikely that we’ll see any strong value declines as we now start to move into the cooler months of the year. Of course, it’s also equally unlikely that we’ll see any sudden strong home value growth,” Wilson said.