Increase of house values slows

National house values have eased during the past three months, as the heat comes off Auckland and Christchurch properties and aligns with the lesser quarterly gains seen in regional areas.

While Auckland and Christchurch's gains on a year ago are respectively 13.1% and 7.6%, their quarterly movements of 2.6% and -0.2% reflect the ongoing theme of the regional values.

Nationally, the value gain on a year ago is 8.2%, while the quarterly gain plunged to 0.7%.

The Reserve Bank's loan to value ratio (LVR) lending restrictions continue to have an effect in many regions, with activity significantly slower at the entry level end of the market, including Dunedin sales in the under-$250,000 bracket.

Quotable Value (QV) national spokesperson Andrea Rush said nationwide values had increased for the second month in a row, following a slight decline in March, but ''the picture is quite mixed'' for the quarter to May.

The growth in house values has slowed over the past quarter, with the national gain being only 0.7%. Photo by Gerard O'Brien.
The growth in house values has slowed over the past quarter, with the national gain being only 0.7%. Photo by Gerard O'Brien.
''Whilst values in all the main centres have increased to varying levels, some areas within the cities are showing decreases and values in many of the smaller regions are flat or decreasing,'' she said.

Dunedin-based QV valuer Duncan Jack said values around the city had been ''fairly static'' in recent months and listings were at ''reasonably low levels'' which might reflect a traditionally slow period going into winter.

''Although buyers are still active they are very cautious with their purchasing decisions,'' Mr Jack said.

In Queenstown Lakes, property values had increased 1.1% during the quarter and 5.6% on a year ago, the average value in the district being $668,791. Central Otago was down 0.1% for the quarter and up 5.3% for the year, at $314,022.

Ms Rush said the values of lifestyle properties around the Wakatipu basin had been ''variable'', while the ''hotspots'' of Frankton and Arrowtown had seen values there rising faster than other areas.

Mr Jack said in Dunedin the strongest demand was for well-presented properties in the mid-higher ranges, being properties over $300,000.

Dunedin's peninsula and coastal areas were the market leaders, with values up 3% during the past quarter and 4.3% on a year ago.

''Activity in the entry level end of the market under $250,000 remains subdued due to the LVR restrictions as many first home buyers don't have the deposit to purchase now,'' Mr Jack said.

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