The latest QV report predicts a stable year with no significant leaps or dips
The latest QV House Price Index has observed relatively minor fluctuations in quarterly values, and has predicted a stable 2019 with ‘modest’ growth and decline across the board.
Hawkes Bay has been a strong performer and has seen some of the strongest value growth in the country, with a solid annual growth figure of 19.6% recorded in the last quarter. By contrast, some of the country’s most popular cities including Wellington and Dunedin have seen a slight decline in quarterly value growth, with Wellington City notably seeing a figure of 1.0% in January – a drop from its usual 1.9%-3.9%.
The Index has shown that residential property values have grown steadily over the last year, and by 0.9% in the three months to January 2019. The Auckland market nonetheless continues to stagnate, with values across the Auckland region decreasing by 0.9% year on year, and by 0.1% over the last three months to January.
According to QV senior consultant Paul McCorry, impending policy changes and market conditions have taken a toll on investor confidence, and many are holding off purchasing in the short term.
“While the loosening the LVR restrictions will have enabled some new buyers to enter the market, this has been offset by a number of policy changes – both confirmed and anticipated – that has put a dampener on investor enthusiasm in the short term,” McCorry stated. “It’s likely many investors are taking a ‘wait and see’ approach; they’re holding off buying or selling until key policy changes, such as the Capital Gains Tax, gets debated in government in the coming weeks.”
“Interestingly, premium areas such as the Queenstown Lakes - where the Foreign Buyer Ban was anticipated to have the greatest impact – continues to see a solid quarterly growth figure of 3.0%. In contrast, another high value area which may have had an impact from the ban, Auckland, continues to see values remain flat.”
McCorry says growth levels will likely remain largely the same over the coming months, with favourable lending conditions predicted to continue into the foreseeable future. He says growth is unlikely to match the levels reached over the past few years, but any decreases in value are also likely to remain ‘modest.’
