Home values continue to ease but stability looms
As spring emerges, the New Zealand housing market shows only modest signs of change, according to the latest QV House Price Index.
Nationally, home values fell by 0.4% in September and 1.6% over the last quarter, following a 0.5% monthly and 2% quarterly decline in August.
The average home value now stands at $901,920, up just 0.3% from last year.
Home values slow decline in major cities
Across much of New Zealand, home values are leveling out. The quarterly decline in key urban areas like Auckland (-1.7%), Christchurch (-0.8%), and Hamilton (-1.2%) has slowed compared to previous months.
However, Wellington remains an outlier, with property values dropping by 3.2%—double the national average, QV data showed.
Market sentiment begins to shift
QV operations manager James Wilson (pictured above) noted that falling interest rates are beginning to lift market sentiment.
“We’re really starting to see sentiment shift across much of the country,” Wilson said, as more potential buyers engage with the market.
But despite rising optimism, the current conditions – including high borrowing costs and living expenses – aren’t yet conducive to growth.
Excess stock keeps prices in check
With a large amount of housing stock on the market, prices remain under pressure.
Wilson observed that buyers still have plenty of options, which has helped to keep prices steady. However, he expects this balance to shift if interest rates drop further, especially after the Reserve Bank’s October update.
Competition expected to increase
While first-home buyers remain active, investors are beginning to return, potentially increasing competition.
“Values will inevitably tighten again when prospective buyers aren’t so spoilt for choice,” Wilson said, but acknowledged that the market hasn’t reached that point yet.
Visit the QV website for a regional breakdown of the latest QV House Price figures. Compare the latest figures with the previous results.
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