House prices increase 21%, despite attempts to brake growth

Government and Reserve Bank efforts to slow house price growth are yet to have an impact.

The latest QV House Price Index data shows the market hit a new high in April, with the average national value up 8.9 per cent over the previous three-month period.

The national average value was $913,209, representing a year-on-year increase of 21.4 per cent, compared with last month’s 18.2 per cent rise.

“We’re hearing a range of anecdotal evidence of investors disappearing from auction rooms and even a decrease in first-home buyer presence,” QV general manager David Nagel said.

“And while less properties may be selling under the hammer, the majority are still being sold at prices that are at least as strong as before the tax announcements were made at the end of March.”

It would take a couple more months to see whether the recent tax changes were having an impact on sales, Nagel said.

“But there’s certainly an expectation that we’ll see at least a slowdown in the rate of value growth, with potentially less investors and maybe a few more first-home buyers entering the market over the coming months.”

The average value in the Auckland region rose 8.2 per cent to $1.3 million in three months to April, over the previous quarter, with annual growth of 19 per cent.

Of the 16 major urban centres, all except Napier City and Queenstown Lakes District were showing an increase in quarterly growth.

There had been strong growth in the regions as well with Wairoa topping the list of provincial centres in the North Island with prices rising by an average of 21.8 per cent over the last three months.

In the South Island, Buller leads all provincial centres with house prices rising 16.6 per cent this quarter. Marlborough and Grey District were not far behind with average house price rises of 13.7 per cent and 13.1 per cent respectively.

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