First-home buyers fueling the recovery
The New Zealand property market has remained largely flat overall, but further signs of revitalisation are spreading throughout much of the country, according to Quotable Value.
The latest QV House Price Index showed the average home value up by just 0.9% in the September quarter to $899,256, and with twice as many of the main urban centres QV monitors experiencing positive home value growth in the third quarter than in the previous index.
Invercargill leads the pack this quarter, with a growth of 3.2% to $468,009. This was followed by Auckland (1.6%), Wellington (1.5%), and Queenstown (0.9%) heading a list of 10.
“You can best describe the market as flat right now, but we certainly are starting to see signs of life once more,” said James Wilson (pictured above), QV operations manager, in a media release. “A recovery is underway, which is largely being fuelled by first-home buyers. They remain the most active group by far, but we’re also now starting to see it expand beyond just entry-level locations for the first time.”
All main centres bar one showed either positive home value growth or a softening in the rate of decrease this quarter. The exception was New Plymouth, where the rate of reduction lifted to 1.5% in September. This was the second largest average home value reduction, after the 1.8% declines posted this quarter in both Whangārei and Nelson.
“The mindset seems to be shifting within our main urban centres, with even Wellington gaining a small amount of momentum after experiencing some of the largest declines since the downturn began in late 2021,” Wilson said. “Though people remain cautious, prospective buyers have been watching the market bottom out, and even start to increase a little bit in some areas, and now they’re getting increasingly active. A return to record migration is also helping to fuel demand.”
He said the increase in competition was putting upward pressure on prices, with the number of new listings flowing onto the property market also remaining largely flat overall.
“We’ve been experiencing a bit of a spring clean-out of old housing stock that has been sitting on the market for a while, but we’re still yet to see the spring surge in listings that we’d typically see this time of year,” Wilson said.
“If the weather allows it, we’ll likely see an uptick in residential property listings after the election. Until then, there is still lots of uncertainty out there, and markets don’t tend to respond too well to uncertainty, especially while such strong economic headwinds continue to blow. For that reason alone, I expect the market will stay flat to gently rising for the foreseeable future.”
Keep track of all these value movements and more via the interactive QV House Price Index — or search here to discover the latest value of your home.
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