Region's property values continue moderate growth for past year

Wednesday, 4 April 2018

A aerial view of The Wood and Nelson East.

Property values in Nelson and Tasman have continued to grow above the national average in the past year.

The latest monthly QV House Price Index shows nationwide residential property values for March increased 7.3 per cent over the past year and 1.2 per cent over the past three months.

The nationwide average value is now $677,618, with the average Auckland house now worth $1,055,992.

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Nelson residential property values rose 8.4 per cent in the year to March and 2.0 per cent over the first quarter of 2018. Values in the Tasman District were up 9.7 per cent year on year and 1.2 per cent over the past three months.

The average value in Nelson city is now $566,052 and $562,614 in the Tasman district.

QV Nelson Property Consultant Craig Russell said there had been a strong demand across the region, particularly for entry-level homes with multiple-offer situations still commonplace.

Flats and low-maintenance homes in The Wood remained popular with retirees, due to its handy location close to the city centre and amenities.

Nelson South and Washington Valley were also popular areas for first home buyers and investors given their central location and being generally comprised of entry level housing which provided better yields.

'Demand for executive type new or near new housing in the $750,000 to $900,000 price bracket has slowed slightly over the past few months with these properties often requiring an extended marketing period,' Russell said.

'This is likely due to affordability becoming more of an issue with house price inflation increasing at a faster rate than wage growth.'

QV national spokeswoman Andrea Rush said residential property value growth remained subdued compared to recent years, although March had seen the usual seasonal pick-up in sales volumes and activity.

Of the main centres, Dunedin leads the way with annual growth of 9.4 per cent, while the Auckland region has slowed to just 1 per cent in the past year. Christchurch values were down 0.6 per cent.

The highest quarterly growth was seen on the East Coast settlement of Opotiki, where values rose 16.1 per cent in the first quarter of the year.

'It's the regions that continue to see the highest value growth driven by demand from people looking for more affordable homes or investment properties outside of the main centres,' Rush said.

Restrictions on finance being eased by the retail banks had made it a little easier for some investors and home buyers to make purchases, she said.

'First home buyers appear to be capitalising on subdued investor activity and some are finding they can purchase more easily without the same level of competition from multiple property owners if they are not already priced out of the market.'

The rise of the regions was echoed by latest statistics released by realestate.co.nz, New Zealand's largest property listing site.

Gisborne, Northland, Marlborough, Coromandel and Hawke's Bay were named as the top five 'hot regions'. All recorded more than a 3.5 per cent increase in asking prices compared to the previous month, as well as a healthy lift in the number of new listings compared to March 2017.

Listed as Nelson Bays, the region recorded the seventh-highest percentage lift in asking prices of 2.9 per cent to $607,182.

It also recorded a 9.5 per cent jump to 276 new listings and leads the country in the growth of housing stock over the last 12 months, recording a 13.4 per cent rise in the number of available dwellings for sale with 450.

'The regions are looking lively with asking prices and new listings up in most of the country's regions, while the main centres paint a different picture,' said realestate.co.nz. spokeswoman Vanessa Taylor.

None of the main centres made the top 10 for largest asking price increases.

Gisborne topped the March table with a 14.5 per cent increase in the average asking price to $368,395, and a 29.8 per cent lift in new listings (109).

Marlborough showed an 8.9 per cent asking price increase to $504,476 and a 5.5 per cent increase in new listings (134), while Hawke's Bay had a 3.8 percent increase in asking prices to $486,144 and a 19.8 per cent increase in new listings (387).