Auckland house values have fallen slightly over the summer, but prices are going gangbusters in some North Island provincial centres, particularly in Hawke's Bay.
The latest QV House Price Index shows average values of residential properties in Auckland fell 0.1 per cent in the three months to Jan. 31, but they were up 10.8 per cent in Hastings, 10.2 per cent in Wairoa - both in the Hawke's Bay - and 6.6 per cent in Stratford, Taranaki.
The average Auckland house will still set you back a tad over $1 million, but in Hastings you can get one for about half that - $504,000 average.
Hawke's Bay QV property consultant Nicola Waldon says the local market is being buoyed by out-of-towners, particularly from Auckland, and by developers wanting to make money renovating and on-selling houses.
"Overall, low levels of supply coupled with low interest rates continue to support strong value growth. Well-presented properties are selling quickly ... which reflects how busy the market currently is."
Meanwhile, relatively cheaper-priced regional centres also saw the biggest growth in average house values on a year-on-year basis. Whanganui, Upper Hutt, Palmerston North, Invercargill, Hastings, Napier and Dunedin all saw greater than 10 per cent growth in the year to Jan. 31. At the same time Auckland values fell 0.9 per cent, Christchurch nudged up less than 1 per cent, Wellington average values rose 7.9 per cent and in Hamilton, home values increased by 5.9 per cent.
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Overall, New Zealand average values were up 0.9 per cent for the three months, and 2.9 per cent for the year. The value of the average Kiwi property is just under $685,000.
QV senior consultant Paul McCorry says loosening loan to value ratio (LVR) restrictions allowed some new buyers into the market. At the same time future policy initiatives, particularly a possible capital gains tax, may have put people off.
However, he isn't anticipating a slump anytime soon, with a shortage of houses in some centres, a strong labour market, population growth, and low interest rates helping the market relatively buoyant.
"We're expecting 2019 to be a year where value growth is not at the levels of the last few years but equally any value decreases are likely to be modest as demand still outstrips supply."