Bay's housing market on rise

Hawke's Bay's housing market is on the rise.

Hawke's Bay's property market is moving fast, a local property expert says.

QV's May residential price movement index showed average home values increased across the region year-on-year.

In Napier, house values increased by 1.3 per cent to $328,921; in Hastings, values increased 1.8 per cent to $306,993; and in Central Hawke's Bay, they increased 3 per cent to $216,750.

QV data is based on settled sales. Tremains Real Estate director Simon Tremain expected growth in the number of unconditional sales to be far greater.

"We're getting lots of out-of-town buyers," he said. "The gap between the Auckland median and Hawke's Bay median is huge so people are seeing Hawke's Bay as a really viable option to put their money."

Investors, speculators and local buyers were also in the market.

"Seeing capital growth in the market gets people on board. Nobody likes selling their properties at a loss so now they're selling them for a reasonable price."

Demand was outstripping supply, he said.

"It traditionally quietens down in winter but with this amount of activity in the marketplace, it's not going to quieten down."

Nationwide, residential property values continued to soar in May - up 3.1 per cent over the past three months and 9 per cent year-on-year.

This was the fastest year-on-year rise in 15 months, taking values to 24.1 per cent above the previous market peak of late 2007.

QV national spokeswoman Andrea Rush said the market continued to be affected by activity in larger centres.

"The steepening line of the national index reflects value increases across all of New Zealand's main centres over the past three months with the exception of Wellington, which is showing a slight decrease," she said.

"The usual winter downturn does not seem to have dampened demand as high net migration, relatively low interest rates and a constrained housing supply continue to fuel demand in the Auckland market.

"This demand is also now spreading to provincial centres nearer to Auckland with values up in Tauranga, Hamilton, Cambridge, Pokeno and towns in the Hauraki District."

Changes coming in October, including the Reserve Bank's new loan-to-value ratio limits, requiring borrowers in the Auckland Council area to have a deposit of at least 30 per cent, haven't had an obvious impact yet, Ms Rush said. NZME.