The annual pace of New Zealand house value growth eased to its slowest rate in nearly two years in January, government agency Quotable Value (QV) said this morning.
The agency's residential house price index rose 8.8 per cent in the month from a year earlier, down from a9.2 per cent rise in December and 9.4 per cent in November.
It was the slowest pace of growth since the monthly survey began in February 2005. Growth peaked at 16.8 per cent in January 2006, but has slowed every month since then.
"This month, whilst still a healthy rate of increase, does reflect a gradual easing in pressure on property prices" said QV spokesman Blue Hancock.
Reserve Bank of New Zealand Governor Alan Bollard, has singled out the housing market's strength as the central bank's main concern for inflation, warning that interest rates are likely to rise unless there is a noticeable cooling.
Interest rates will be reviewed on March 8, with 13 out of 16 economists surveyed by Reuters expecting the central bank to raise its official cash rate by a quarter-point to 7.5 per cent.
Annual growth in Auckland city, part of New Zealand's main population and business centre, eased to 4.5 per cent from 6.7 per cent the previous month.
Growth in other main urban areas was generally positive, with the capital Wellington rising to 9.7 per cent from 9.3 per cent, Christchurch, the South Island's main city, steady at 9 per cent growth. Hamilton rose to 11.7 per cent growth from 9.7 per cent, while Dunedin was steady at 6.2 per cent annual growth.
Hancock said there was still strong growth in some provincial areas where prices have been below the national average.
"Strong migration figures, a stable cash rate and lower unemployment figures are all contributing to a continuation of higher prices in the residential market," he said.
The average national house sale price rose 2 per cent in January from the previous month to NZ$356,028 ($243,855), according to the QV data.
The monthly residential price report is based on sale prices of properties over the past three months compared with sales over the corresponding three-month period a year earlier. The figures are not seasonally adjusted.
Data released last month by industry group, Real Estate Institute of New Zealand, showed the median house price staying at a record NZ$330,000, up 11.9 per cent in the year through December.
