Auckland house prices dropped by more than half a per cent over the past three months while they rose by over one per cent nationally.
The latest monthly QV House Price Index shows nationwide residential property values for September rose 4.3% over the past year.
Values rose by 1.1% over the past three months and the nationwide average price is now $646,378 which is 56 per cent above the previous market peak of late 2007.
When adjusted for inflation the nationwide annual increase drops to 2.5 per cent and values are now 30.2 per cent above the 2007 peak.
Residential property values across the Auckland Region increased 0.8% year on year but dropped by 0.6% over the past three months.
The average price for the Auckland Region is now $1.039 million and prices are now on average 90.1 per cent higher than the 2007 peak.
The reductions in quarterly value growth have extended from just the main centres last month to almost all the 15 major urban areas - QV National spokesperson David Nagel
When adjusted for inflation Auckland values dropped one per cent over the past year and are 58.7% above the 2007 peak.
QV National spokesperson David Nagel says the reductions in quarterly value growth have extended from just the main centres last month to almost all the 15 major urban areas the government agency tracks with the exception of Rotorua, Palmerston North, Dunedin and Invercargill.
"The year on year growth is still showing double digit gains in many of New Zealand's provincial towns; however the quarterly change shows a gradual slowing of the property market in almost all city locations," he said.
"Values are reflecting small decreases in all but a few isolated pockets of Auckland while Tauranga and Christchurch have also shown a small decline over the past quarter."
Mr Nagel says the normal spring surge in property listings still hasn't eventuated throughout most of the country and this lack of supply has helped insulate the market from more significant falls in values.
"While the property markets appear to have run out of puff in the main urban areas, there's still plenty of activity in the smaller provincial towns which were slower getting started,” he said.
While there is uncertainty around who will govern the country, there are policies that if agreed on under a coalition government could influence the property market, Mr Nagel said.
These include a gradual reduction on immigration numbers which has previously helped fuel the property market, particularly in Auckland, and the increase in housing supply, he said.
"What will be most interesting will be whether a new government supports the relaxing of the Reserve Banks LVR restrictions as well as what support policies get rolled out to help first home buyers get onto the property escalator," he said.
Auckland demand 'halted' by buyers' borrowing problems
QV Auckland Senior Consultant James Steele says sales volumes are down to very low levels in Auckland as demand is halted by the ability for purchasers to finance property deals.
The number of listings has also eased as there is little pressure at the moment for home owners to sell, as rents remain high and interest rates low, and a number of vendors and purchasers are taking a 'wait and see' approach until after a new government is formed, he said.
Well-presented homes in desirable suburbs are still in strong demand by movers, however there are issues with deals falling over due to trouble obtaining finance under retail banks stricter lending criteria, Mr Steele said.