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Price falls slowing in NZ residential property market

Property values fell 7.1% in June compared with 8.1% in May and 9.2% in April, the latest QV Valuations report shows.

The national average house sale price has now increased to $378,535 in June from $371,555 in May. Sales volumes are now approaching more normal levels and an increase in the number of people intending to buy alongside a decrease in the number planning to sell could lead to a shortage of properties and more competition among buyers, the QV report says.

According to valuations manager Glenda Whitehead, an increasing number of people believe that the worst of the decline is over and that now is a good time to buy before the market picked up again.

A smaller group believed that worsening economic conditions would lead to further house price falls. Property values have risen in most of the main centres over the past three months.

In Auckland region, the annual decline has improved to -5.9% from -7.6% last month. The average sale price has increased from $483,397 to $489,444.

'We are seeing more activity in the medium price bracket in Auckland over $500,000 in suburbs such as Ellerslie and Mt Eden,' said Whitehead.

QV manager Richard Allen said it was the fourth month prices had recovered. But he remains cautious and described the situation as stabilising but looking ahead there could be a lack of demand over the winter months despite more people wanting to buy.

Elsewhere in the country Hamilton values improved to a 6.6% fall compared with -7.5% in May, Tauranga improved to -8% compared with -9.4%, Wellington improved to a 6.5% fall compared with -7.4%, Christchurch fell 7.3% from -8.1% and Dunedin was down 4.5% compared with May's decline of 5.4%.