KEY POINTS:
The residential property market continues to slow, with growth rates easing in all major cities and main provincial centres, according to figures released by Quotable Value yesterday.
Property values rose 8.9 per cent in the year to January, down from 10 per cent growth in the year to
December and more than 13 per cent in the year to August, which was the highest growth rate of 2007.
The average national residential sale price increased to $390,636 last month from $388,253 in December.
QV spokesman Blue Hancock said that even though year-on-year growth was still positive, it had slowed rapidly.
"This reflects the easing market of the last few months compared to the buoyancy of last spring and summer. If the easing continues we would expect to see growth flatten to the point where there is no annual gain in value.
"Preliminary analysis carried out by QV suggests that over the past three months there are many areas across the country where the growth in property values is static," he said.
Higher mortgage interest rates were hurting property owners with low discretionary incomes, and debt-laden property investors coming off fixed-rate mortgages and renegotiating at much higher interest rates.
"There are increasing reports from our valuers of properties going to mortgagee sale, with the number of these sales likely to increase as the year progresses," he said.
QV calculates its figures over three-month periods, comparing data with the corresponding period a year earlier.
The number of residential sales appears to be slumping too.
Auckland's largest real estate agency, Barfoot and Thompson, said last week that it negotiated 604 sales last month compared with 1003 for the same month last year.
Its average January sale was $517,613 compared with the December average of $559,803. However, it said prices were still well ahead of last January's average of $475,461.
The Real Estate Institute will release nationwide figures this week on sales numbers and prices.
Harcourts January figures will also be available this week.
Institute president Murray Cleland said it was important to remember that values hadn't dropped dramatically even though sales were down.
He said January was traditionally a quiet time. "Wait to see what happens in February/March. That will give us a true figure of what's happening in the property market."
Glenda Whitehead of QV Valuations said property values in the Auckland region increased by 9.6 per cent over the past year.
The average sale price was $507,728 last month, down from $511,188 in December.
"With such a brilliant summer being dished up, there seems to be little focus on the property market in Auckland at present. The predicted easing in growth rates continues in all areas of Greater Auckland with the exception of Franklin," she said. "Overall activity has been sluggish, with those properties on the market sitting longer than what we have been used to."
Figures released yesterday by www.realestate.co.nz (which features almost 90 per cent of all licensed listings) show there are 35 per cent more residential property listings than the same time last year.