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Property market slowdown expected to continue as wage subsidy, mortgage relief packages end

New Zealand's housing market resurgence appears to be slowing down, according to the latest QV House Price Index.

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QV data shows Auckland, Queenstown and Dunedin house values have fallen over the past three months. Source: Breakfast

With the Government's wage subsidy and bank mortgage relief packages ending soon, the property market could still be in for some hard times ahead.

Auckland, Queenstown and Dunedin house values have fallen over the past three months, with Queenstown Lakes District seeing the biggest drop of 4.2 per cent.

QV data saw the average house value nationally increased just 0.4 per cent over the past three months - down from 1.3 per cent in June, with the average value now sitting at just over $739,000.

The average value in the Auckland Region sits at $1,077,000, which is down 0.2 per cent over the last quarter, with annual growth at 5.1 per cent, down slightly from June's year-on-year growth of 5.4 per cent.

However, QV General Manager David Nagel said Dunedin was the biggest surprise, recording a 0.3 per cent decline over the past three months.

"There's been plenty of hype around demand and we're still seeing well attended auctions and open homes, especially for the more affordable housing stock," he said.

"This has resulted in strong transaction numbers in the past few weeks leaving limited stock. But there's also a lot of properties that aren't selling as buyers exercise both caution and patience as they search for a suitable property.

"Unfortunately first home buyers are competing head-on with the more buyer savvy investors and this has created a bottleneck of demand in the more affordable locations and property types."

Mr Nagel said investors would be keeping an eye on the Government's Residential Tenancies Amendment Bill which it hopes to push through under urgency this week.

It describes its proposed new law as ensuring a "fairer and more secure rental market for renters and landlords".

However, New Zealand Property Investors Federation's Andrew King told TVNZ1's Breakfast yesterday "what this does is it protects the two per cent of tenants who are antisocial".

"It actually gives them permission, this bill says that from now on any minor antisocial behaviour is going to be acceptable, the landlord can do nothing about it," he said, fearing people thinking of investing in property and becoming landlords would hold back.