Real estate uncertainty still remains

While property values in Dunedin are still increasing, values in Waitaki, Central Otago, Clutha and Southland appear to be sliding.

Dunedin's property values increased by 6.2% during the past year, up on the 5% annual growth reported in January.

The average sale price in the city increased from $279,101 to $285,787.

QV Valuations valuer Tim Gibson, of Dunedin, said the positive growth in Dunedin's residential property market was evident in all areas of the city, with coastal Dunedin playing catch-up to other areas in terms of year-on-year growth.

However, values were still 3% below the market peak of July 2007, he said.

Queenstown Lakes (0.8%), Invercargill (4.3%) and Gore (4.4%) were the only other areas in the southern region to show increases in property values.

"The uncertainty which has persisted in the property market since Christmas still remains, and can be confirmed by other underlying indicators," Mr Gibson said.

"QV's residential price index has shown a decrease for the second consecutive month - a guide that values may be levelling out within Dunedin.

This is also a trend shown by more provincial areas of New Zealand over the past two to three months."

Property values decreased in Waitaki (-1.9%), Central Otago (-0.4%), Clutha (-5.1%) and Southland (-5.8%) during the past year.

Mr Gibson said property listings during February had increased significantly since the low volumes experienced during December 2009 and January 2010.

"This may be due to more investors selling out before the Government budget is announced in May, when taxation details are due to be confirmed.

"The next two or three months will be a good guide as to how the property market will perform during 2010," Mr Gibson said.

The situation was similar nationwide.

QV valuer Glenda Whitehead, of Auckland, said property values were above the same time last year.

The national average sales price increased from $409,807 in January 2010 to $416,074 in February 2010.

While the year-on-year change had increased further to 5.5%, property values in the past few months had flattened in many areas, she said.

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