PROPERTY VALUES INCREASE AS THE MARKET seems STABILISES FURTHER
The QV national residential property indices for June released today show a 7.1 per cent decline in property values over the last year. This is a further improvement on the 8.1 per cent annual decline reported last month, and reflects continued stabilisation of the property market.
Two thirds of the 7.1 per cent decline over the past year occurred between July and October 2008. Further slight declines continued through until April 2009, and since then values have increased slightly. Over the past quarter, nationwide values have increased 0.4 per cent based on the index, compared to the previous quarter when values fell 2.1 per cent. The national average sale price also increased to $378,535 in June from $371,555 in May.
QV Valuation Manager Glenda Whitehead said “the volume of sales is approaching more normal levels, and the market is more stable. Decreases in property values over the past eighteen months combined with historically low mortgage interest rates have led to improved optimism and encouraged more buyers back into the market”.
“There appears to be a general shortage of properties for sale across the country. Lower mortgage rates have enabled many homeowners to re-fix their mortgages at lower rates for three to five years. This has either eased financial pressures so they no longer need to sell, or have led to homeowners deciding to stay put rather than sell and end up on a higher interest rate. Other potential sellers are holding back and waiting for values to increase again, or the winter weather to abate.” said Whitehead.
“Many vendors have now adjusted their price expectations to current market levels. There is increased interest in the market in general, but more so, in good quality properties, often leading to multiple competing offers. Poorly presented properties need to be priced correctly to ensure they find their buyer” said Whitehead.
There are mixed opinions about the where the market will go over the coming months according to a recent survey carried out on QV.co.nz. An increasing number of people believe that the worst of the decline is over, and that now is a good time to buy before the market picks up again. A smaller group believe that worsening economic conditions both in New Zealand and overseas will lead to further house price decreases.
Concerns over job security, recent rises in interest rates, and tighter lending conditions are acting to curb some of the recent buyer enthusiasm. There has been an increase in the number of people intending to buy in the next twelve months, but fewer who intend to sell, which may lead to further shortages of properties for sale. The changing balance of these buyer and seller sentiments will shape the market over the coming months.
Property values have increased in most of the main centres over the last quarter. As a result, there has been an improvement in the annual change in all areas. In the Auckland area the annual change has improved to -5.9 per cent from -7.6 per cent last month. Hamilton has improved to -6.6 per cent, the Wellington area to -6.5 per cent, Christchurch to -7.3 per cent and Dunedin to -4.5%. Tauranga was the only main centre to show a continued slight decline over the last quarter, but the annual change in values has still improved to -8.0 per cent from -9.4% last month.
Slight increases in property values in recent months have also led to improvements in the annual change in most of the provincial centres. Whangarei improved slightly to 12.4 per cent, Rotorua improved to -8.1 per cent, Gisborne to -13.4 per cent, New Plymouth to -3.3 per cent, Palmerston North to -8.4%, Queenstown Lakes to -7.0 per cent and Invercargill to -8.2 per cent. Property values in Wanganui have continued to decline in recent months so the annual change has worsened to -6.0 per cent.
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 |
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|
 Auckland Region |
| -5.9% |
| $489,444 |
| Hamilton |
| -6.6% |
| $337,851 |
| New Plymouth |
| -3.3% |
| $316,365 |
| Palmerston Nth |
| -8.4% |
| $284,987 |
| Christchurch |
| -7.3% |
| $339,962 |
| Queenstown |
| -7.0% |
| $594,137 |
| Invercargill |
| -8.2% |
| $204,910 |
|
 |
| Whangarei |
| -12.4% |
| $331,279 |
| Tauranga |
| -8.0% |
| $427,927 |
| Rotorua |
| -8.1% |
| $268,892 |
| Napier |
| -9.2% |
| $311,006 |
| Hastings |
| -9.2% |
| $293,187 |
| Wellington Rgn |
| -6.5% |
| $430,939 |
| Nelson |
| -5.2% |
| $344,865 |
| Dunedin |
| -4.5% |
| $256,493 |
|
|
|
| New Zealand |
| -7.1% |
| $378,535 |
|
Annual Property Value Change
Average Sales Price |
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