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Slowdown continues for property values

Media release
7 March 2008

Embargoed to 11.59pm Sunday, 9 March 2008

Slowdown continues for property values

QV's February statistics for the residential property market report a 7.7% growth in national property values over the past year (calculated over the three months ending February 2008 in comparison to the same period last year), down on the 8.9% growth reported in January. The average New Zealand sale price increased to $393,240 this month (from $390,636 last month).

"The property market is fairly subdued despite most areas in the country still experiencing good 'year on year' growth in property values, but the rate of this growth is slowing rapidly. Banks have lifted their mortgage rates, properties are staying on the market for longer, and the volume of sales is really dropping. There are less active buyers and sellers in the market, with those keen to sell having to accept lower offers" said QV spokesperson Blue Hancock.

"Clearly the market is slowing down and taking a breather, and we expect this will continue given the current market conditions. It looks like we may be in for a sustained period of less activity in the property market" said Mr Hancock.

Annual growth rates continue to decline in all of the main urban centres. Hamilton recorded the greatest easing in property value growth dropping from 8.3% last month to 6.1%. Wellington City decreased from 10.6% to 9.2%, Christchurch from 6.9% to 6.1% and Dunedin from 6.1% to 5.3%. Auckland City eased to 7.2% (last month 7.9%) and Tauranga slowed to 2.9% (from 3.4% last month).

A similar pattern of slowing growth rates was also recorded for the main provincial centres. Whangarei 7.3%, Gisborne 5.4% and Taupo 0.1% all slowed. Wanganui decreased to 5.0%, New Plymouth to 3.9% and Palmerston North dropped marginally to 7.1%. Queenstown's growth rate continues to slow, down further to 5.2%.

ENDS

See... Commentary, data and notes (PDF)

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