Article – BusinessDesk
By Hannah Lynch
Sept. 11 (BusinessDesk) – New Zealand property values extended their gains in August, as first-home buyer interest picks up, interest rates remain low and banks relax lending criteria, according to government valuer Quotable Value.
National property values rose 1.6 percent in the three months ended Aug. 31 and have increased 4.8 percent over the past year, to be 0.4 percent off the market peak in 2007.
National trends include a shortage of listings, more first-home buyers as a result of low interest rates, investors back in the market looking for properties that can return a good yield, Jonno Ingerson, research director said. “The main centres continue to lead the growth in national values, with values increasing fastest in Auckland.”
Values in Auckland rose 2.6 percent in the three months ended Aug. 31 and have gained 6.8 percent over the past year. That’s 6.5 percent above the 2007 market peak.
“There are pockets of property close to the CBD, such as Sandringham and Mt Albert, where values are catching up to the rest of central Auckland, and so recent increases in value have been quite strong” Jan O’Donoghue, a QV valuer, said.
“The amount of properties on the market is still, low meaning many potential buyers can’t find the properties they want,” she said. “We expect the market to pick up over the next few months, especially with the number of new listings increasing as you would expect at this time of year.”
Values in Hamilton rose 1.3 percent over the past three months and are 3.5 percent higher than this this last year, with first home buyers driving the lower end of the market, the government valuer said.
Values in Christchurch have gained 1.4 percent over the last three months and 5.5 percent over the past year.
Wellington’s property values remained flat over the past three months, with values up about 2 percent since this time last year.
“There is still a lack of choice for many buyers who have been searching for some time, but like other main centres there are signs that people are now preparing their properties for sale in spring,” said Daryl Taggart, a QV valuer. “Although confidence is still low overall, some top end properties have been selling well and first home buyers are still actively looking for homes and smaller apartments”.
Values in provincial centres have remained “relatively stable” over the past year, with values lying within a 2.2 percent band. The exception is Gisborne down 3.6 percent over the past year.
On Monday, the Real Estate Institute of New Zealand released figures showing the number of house sales climbed 16 percent last month as the property market recovers from 2011’s lows on the continued strength of the Auckland and Christchurch property markets.
The number of sales increased by 843 to 6,035 in August compared to the same month a year earlier and was up 2.2 percent on July. The increase was led by an 18.4 percent increase in the number of auctions to 588, a new record for the month.