The average value of New Zealand homes is now $888,999
New Zealand’s housing market downturn has continued to decelerate, with the nation’s three-month rolling rate of decline shrinking for the fourth consecutive month, according to the latest figures from Quotable Value (QV).
The average value of New Zealand homes was $888,999 at the end of July.
The figure was down 1.5% nationally this quarter, which was slightly lower than the 1.8% change back in June, and significantly less than the 3.5% and 3.4% quarterly declines in April and May, respectively, according to the QV House Price Index for July.
Most urban areas recorded declines in their average dwelling values in the three months to the end of July, with four delivering small amounts of positive home value growth over the same period – Hamilton (0.1%), New Plymouth (0.4%), Christchurch (0.8%), and Invercargill (0.8%).
Auckland and Wellington continued to see declines in home values, with decreases of -1.5% and -1.7%, respectively. Nelson (-2.4%), Whangarei (-1.4%), Queenstown (-1.3%), and Rotorua (-0.5%), meanwhile, saw the average rate of reduction increase. The latter two posted positive growth just last month, reflecting the current market’s heightened volatility.
James Wilson, QV operations manager, said it wouldn’t be uncommon to see dwelling values continuing to yo-yo for the foreseeable future, largely due to reduced sales activity.
“Though low sales volumes continue to impact the monthly value change results significantly, causing some short-term spikes in average home value levels, the longer-term trend is pretty clearly a residential property market that is bottoming out after some very significant home value reductions over the last 18 months or so,” Wilson said.
He said it’s still early days, though, and it’s unlikely that the market will reach a consistent bottom overnight.
“Instead, we’re likely to see significant variations in performance in sub-markets across the country, as we see demand return in certain areas and for certain property types at different times,” Wilson said. “Meanwhile, that heightened level of volatility is set to continue until sales volumes increase further.”
The QV leader said first-home buyers continued to be the most in the market, but there was some renewed interest coming from investors.
“While investors never removed themselves from the market entirely, they have adopted more cautious attitudes in recent times,” Wilson said. “Now we’re starting to see growing numbers competing for entry-level stock in areas they view as offering good value for money.”
Some property types, including small to medium development sites, whose values were significantly hit during the downturn, were likely to continue to fall as demand for these properties has dropped away, QV reported.
“New building consent numbers are forecast to remain suppressed throughout the year, as interest rates, build rates and overall demand continue to hamper demand,” Wilson said.
For a regional breakdown of the latest QV House Price figures, click here. To keep track of all these value movements and more, visit the interactive QV House Price Index.
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