Property values extend gains in August QV
BUSINESSDESK: New Zealand property values extended their gains in August, as first-home buyer interest picks up, interest rates remain low and banks relax lending criteria, government valuer Quotable Value says.
National property values rose 1.6% in the three months ended August 31 and have increased 4.8% over the past year, to be 0.4% off the market peak in 2007.
National trends include a shortage of listings, more first-home buyers as a result of low interest rates, investors back in the market looking for properties that can return a good yield, research director Jonno Ingerson says.
"The main centres continue to lead the growth in national values, with values increasing fastest in Auckland."
Values in Auckland rose 2.6% in the three months ended August 31 and have gained 6.8% over the past year. That is 6.5% above the 2007 market peak.
"There are pockets of property close to the CBD, such as Sandringham and Mt Albert, where values are catching up to the rest of central Auckland, and so recent increases in value have been quite strong," QV valuer Jan O'Donoghue says.
"The number on the market is still low, meaning many potential buyers can't find the properties they want.
"We expect the market to pick up over the next few months, especially with the number of new listings increasing, as you would expect at this time of year."
Values in Hamilton rose 1.3% over the past three months and are 3.5% higher than this this last year, with first-home buyers driving the lower end of the market, the government valuer says.
Values in Christchurch have gained 1.4% over the last three months and 5.5% over the past year.
Wellington's property values remained flat over the past three months, with values up about 2% since this time last year.
"There is still a lack of choice for many buyers who have been searching for some time, but like other main centres there are signs that people are now preparing their properties for sale in spring," QV valuer Daryl Taggart says.
"Although confidence is still low overall, some top-end properties have been selling well and first-home buyers are still actively looking for homes and smaller apartments."
Values in provincial centres have remained "relatively stable" over the past year, with values lying within a 2.2% band. The exception is Gisborne down 3.6% over the past year.
On Monday, the Real Estate Institute released figures showing the number of house sales climbed 16% last month as the property market recovers from 2011's lows on the continued strength of the Auckland and Christchurch property markets.
The number of sales increased by 843 to 6035 in August compared to the same month a year earlier and was up 2.2% on July.
The increase was led by an 18.4% rise in the number of auctions to 588, a new record for the month.