House prices rise 3.6 per cent in three months as spring-summer upturn appears to kick in

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The spring and summer upturn in the housing market appears to have finally arrived, says valuation agency Quotable Value.

Auckland, New Zealand - January 11, 2014: New Homes on January 11, 2014. House prices are booming around New Zealand - with the average price of an Auckland city home rocketing to $735,692.

Auckland houses (file picture).

Source: istock.com

The latest monthly QV House Price Index shows nationwide residential property values for November increased 6.4 per cent over the past year, much higher than last month's annual growth of 3.9 per cent. 

Prices rose by 3.6 per cent over the past three months, also up on last month when the market slowed to a quarterly growth of 0.9 per cent.

And the nationwide average value is now $664,485 which is 60.4 per cent above the previous market peak of late 2007. 

When adjusted for inflation the nationwide annual increase drops to 4.4 per cent and values are now 33.9 per cent above the 2007 peak.

In Auckland, however, house price growth was down 0.5 per cent year on year, the slowest annual rate since March 2011, but values ticked up over the past quarter, rising by 0.4 per cent. 

The average value for the Auckland Region is slightly higher than last month at $1,045,741 and values are now on average 91.4 per cent higher than the previous peak of 2007.  When adjusted for inflation values dropped 2.4 per cent over the past year and are 59.7 per cent above the 2007 peak. 

"It appears the spring/summer upturn has finally arrived in the housing market," said QV national spokesperson Andrea Rush.

The nationwide 3.6 per cent surge in value growth over the past three months was led by stronger growth in Wellington, Dunedin and many other regional centres around the country, she said.

Auckland and Christchurch values also ticked up slightly over the past three months bucking a downward trend seen over the past couple of months, Ms Rush said.

However, values in Hamilton and Tauranga fell slightly and some areas to the south and north of Auckland that have seen very strong growth in recent years also saw values drop significantly including the Kaipara and Hauraki Districts, both down around four per cent over the past quarter, she said.

"The easing in LVR restrictions in January and retail banks lending criteria is likely to help improve activity and demand in housing the market as we move through the summer months but it’s possible the usual slow-down over the Christmas period may mean we don’t see the full impact of this until February and March next year," Ms Rush said.

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