Christchurch records sharpest property price growth in 17 years

Christchurch saw the steepest rise in price values of all the main centres. Photo: RNZ / Nate...
Christchurch saw the steepest rise in price values of all the main centres. Photo: RNZ / Nate McKinnon
Property values in Christchurch recorded the strongest rate of monthly growth in 17 years over January.

The latest CoreLogic house price index shows the monthly property value growth rate in the city for January was 3.1 per cent, taking the average value to $556,446 in January.

This was the steepest increase in price values of all New Zealand's main centres.

Said CoreLogic head of research Nick Goodall: "The quarterly (5.8 per cent) and annual (9.0 per cent) rates of growth are more modest than most other cities, but after years of very little growth in the South Island's largest city, the pronounced lift is significant and shows the pace of capital gains is accelerating."

The average house price in New Zealand eclipsed $800,000, and Goodall says consistent government messages about the need to protect property wealth mean prices will continue to grow.

The house price index rose 2.2 per cent in January, with the average house price now sitting at $806,151.

Prices have risen 7 per cent over the previous quarter and were up by 12.8 per cent on a year ago - the highest annual growth rate since March 2017.

Kāpiti Coast recorded the strongest price growth over the month, with values increasing 4.5 per cent to $779,925.

Goodall said demand in New Zealand continued to outstrip supply, which was propelling the market.

"Inventory remains tight across the country, although Trade Me recently reported that advertised stock levels had lifted year-on-year in our largest city.

"Signs are optimistic for stock to continue to come to market, with agent appraisals already back to the same levels as pre-Christmas. However, it must be noted that there would need to be an above-seasonal lift to match current demand, and for now that seems unlikely."

Goodall said consistent messages from the government about the need to protect property wealth meant prices would continue to grow.

The reintroduction of loan-to-value ratios (LVRs) next month at 20 per cent for homeowners and 30 per cent for investors would not be enough to take the heat out of the market, he said.

Goodall said this could lead to a further tightening of LVR limits by the Reserve Bank.

He expected the government to announce some form of housing policy at the end of the month to assist first home buyers and incentivise residential construction.









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