First-home buyers record strong momentum in July

QV's latest House Price Index reveals Kiwis' home buying activities and trends

By Krizzel Canlas

02 Aug 2018

Lower value and more affordable properties are selling at a faster rate due to continued demand from first-home buyers, according to QV Valuations.

The latest monthly QV House Price Index shows nationwide residential property values for July increased 5.1% over the past year, while values dropped 0.7% over the past three months. The nationwide average value is now $673,797. When adjusted for inflation, the nationwide annual increase drops slightly to 3.5%.

QV said analysis shows that most property transactions are taking place at the low-to-medium price bracket, a section of the market where values are more affordable.

QV general mamger David Nagel said first-home buyer activity across New Zealand remains relatively strong, despite drop in activity in some areas over the past few months.

“This could possibly be due to the fact that some buyers are holding off purchasing, hoping they’ll attain a KiwiBuild property in the ballot,” Nagel said. “We’ll be closely monitoring the impact of the government’s initiative over the coming months although its full impact won’t be felt for some time yet.”

In the Auckland region, residential property value growth increased by 0.6% year-on-year although they dropped by 0.1% over the past quarter. The average value is now $1,050,778. When adjusted for inflation, values dropped 0.9% over the past year.

Dunedin, meanwhile, continues to buck the trend, with investors accounting for a growing portion of buyers according to the latest CoreLogic Buyer Classification data. The average value is at $411,669.

However, QV highlighted that activity has dropped in most main centres, partly due to the bank’s LVR restrictions and a period of consolidation after recent growth.

“With overall market conditions remaining strong, such as record low interest rates and strong local economies, I would anticipate that values will remain fairly stable for the remainder of winter,” Nagel said.