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House price rises start to slow
11 September 2006
By SUE ALLEN
Over-optimistic house sellers might have to take a step back and be more realistic about reaping big returns as house price rises ease back for the seventh month in a row.
Prices were 10.5 per cent higher in the three months to August than in the same period a year ago, latest Quotable Value figures show.
They had risen 11.1 per cent in the three months to July, compared with the same period last year.
Quotable Value said the average national house price was $340,473 in the three months to August.
That was up from $336,272 in the three months to July and $328,829 in the three months to June.
Wellington city prices grew 9.5 per cent in the three months to August compared with the same quarter last year. That was a slight drop from the 9.9 per cent rise in the three months to July.
The average sale price was $440,455.
AdvertisementAdvertisementWellington region house prices were 11.8 per cent higher in the three months to August than the same period a year ago, down from the 12.3 per cent rise in the three months to July.
Growth in prices in Upper Hutt dropped to 14.2 per cent in the three months to August from 18.7 per cent in the three months to July.
Lower Hutt's rise dropped to 15.5 per cent from 16.4 per cent.
QV's Max Meyers said the winter was part of the reason for Wellington prices easing.
"But there are also signs of more buyer discretion and properties taking longer to sell if they are unusual or where the seller has price expectations that may be too high."
Kapiti Coast, Porirua and Horowhenua saw price growth accelerate slightly in the three months to August compared with the three months to July.
QV spokeswoman Glenda Whitehead said on a national average, growth rates had now dropped back for the seventh month in a row.
"Prices and property values are still higher year-on-year, with no signs of any dramatic falls.
"But conversely, the demand that was pushing values up faster and faster over the past three years has definitely eased back," she said.
That included a slowdown in the number of new migrants coming to live in New Zealand, and rising home loan interest rates and prices making homes less affordable.
"I also think there's a general feeling out there that house prices will pull back, so there's a bit of wait-and-see going on among buyers and investors."
The Reserve Bank is expected to leave the official cash rate unchanged this week at 7.25 per cent, for the sixth straight time, as the economy slows.
Some economists are picking a further year without a cut in the official cash rate, which influences home loan rates.
QV said August revealed differing trends in the main centres.
Price growth in Auckland city was stable. Dunedin, Rotorua, Gisborne, Hamilton, Palmerston North, Napier, Nelson and Christchurch were all down slightly.
However, Rotorua, with prices growing almost 25 per cent in the three months to August, was the only major centre where prices were still growing at more than 20 per cent.
Ms Whitehead said though growth was slowing, "I think there's a lot of people, who if they're not in the market are certainly looking at it".
11 September 2006
By SUE ALLEN
Over-optimistic house sellers might have to take a step back and be more realistic about reaping big returns as house price rises ease back for the seventh month in a row.
Prices were 10.5 per cent higher in the three months to August than in the same period a year ago, latest Quotable Value figures show.
They had risen 11.1 per cent in the three months to July, compared with the same period last year.
Quotable Value said the average national house price was $340,473 in the three months to August.
That was up from $336,272 in the three months to July and $328,829 in the three months to June.
Wellington city prices grew 9.5 per cent in the three months to August compared with the same quarter last year. That was a slight drop from the 9.9 per cent rise in the three months to July.
The average sale price was $440,455.
AdvertisementAdvertisementWellington region house prices were 11.8 per cent higher in the three months to August than the same period a year ago, down from the 12.3 per cent rise in the three months to July.
Growth in prices in Upper Hutt dropped to 14.2 per cent in the three months to August from 18.7 per cent in the three months to July.
Lower Hutt's rise dropped to 15.5 per cent from 16.4 per cent.
QV's Max Meyers said the winter was part of the reason for Wellington prices easing.
"But there are also signs of more buyer discretion and properties taking longer to sell if they are unusual or where the seller has price expectations that may be too high."
Kapiti Coast, Porirua and Horowhenua saw price growth accelerate slightly in the three months to August compared with the three months to July.
QV spokeswoman Glenda Whitehead said on a national average, growth rates had now dropped back for the seventh month in a row.
"Prices and property values are still higher year-on-year, with no signs of any dramatic falls.
"But conversely, the demand that was pushing values up faster and faster over the past three years has definitely eased back," she said.
That included a slowdown in the number of new migrants coming to live in New Zealand, and rising home loan interest rates and prices making homes less affordable.
"I also think there's a general feeling out there that house prices will pull back, so there's a bit of wait-and-see going on among buyers and investors."
The Reserve Bank is expected to leave the official cash rate unchanged this week at 7.25 per cent, for the sixth straight time, as the economy slows.
Some economists are picking a further year without a cut in the official cash rate, which influences home loan rates.
QV said August revealed differing trends in the main centres.
Price growth in Auckland city was stable. Dunedin, Rotorua, Gisborne, Hamilton, Palmerston North, Napier, Nelson and Christchurch were all down slightly.
However, Rotorua, with prices growing almost 25 per cent in the three months to August, was the only major centre where prices were still growing at more than 20 per cent.
Ms Whitehead said though growth was slowing, "I think there's a lot of people, who if they're not in the market are certainly looking at it".
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