New Zealand property values extended their gains in July as homes in Auckland and Christchurch continue to appreciate amid a shortage of supply, according to government valuer Quotable Value.

National property values rose 2.2 per cent in the three months ended July 31 and have increased 4.6 per cent over the past year, to be 0.8 per cent off the market peak in 2007.

"Across the main centres listings remain relatively tight leading to less choice for buyers," Jonno Ingerson, research director said in a statement. "In Auckland this has led to a sellers' market with prices pushing upwards, while Wellington is showing the first signs of heading that way too."

New Zealand's property market has been on the up this year after stalling through 2011 when potential buyers shied away from taking on too much debt to fund purchases and sellers were unwilling to accept losses from a cheaper price.


"Looking back over the last 30 years, the number of sales usually reaches a low point in June before increasing every month from now until November," Ingerson said. "We expect sales volumes to follow that trend again this year, although if the lack of quality listings continues then this may prevent otherwise enthusiastic buyers."

Values in Auckland rose 3.1 per cent in the three months ended July 31, with an average sale price of $656,846. Values are up 6.3 per cent on an annual basis.

Values in Christchurch increased 2.1 per cent in the three months, with an average sale price of $385,564. Values are up 5.8 per cent over the past year, sitting 1.9 per cent above the previous market peak in 2007.

There was "no change" in Wellington property values in the three months, while the average sale price rose 0.2 per cent to $512,580. That's 5.7 per cent below the previous market peak.

Values in the provincial centres have remained "relatively stable" over the past year, with values lying within a 1.5 per cent band. The exceptions are Napier down 1.7 per cent and Palmerston North up 2.2 per cent.

Gisborne has dropped 4.2 per cent over the past year and is now 25 per cent of the 2007 market peak.