“It was always likely that the property value falls in 2024 would come to an end at some stage in early 2025, given the extent of interest rate cuts since July or August last year.”
He said there had been anecdotal feedback for a couple of months that things had turned but there was a lag between that and it turning into data.
“It may not last every month and there could be blips within that, but there are signs of that upturn creeping out to more markets.”
With interest rates falling, it was “probably only a matter of time” until house prices started to edge up, he said.
There were still restraints on prices, such as the high level of listings on the market and tougher economic conditions.
He said the overall growth figure was masking local variability.
“While some markets have clearly turned a corner, there’s still variability, with Tauranga edging lower in February.”
Hamilton was looking especially strong, he said, and Christchurch and Dunedin were showing more resilience.
“There’s a bit better affordability compared to Tauranga or Auckland.”
But Davidson said sentiment in Auckland had been more positive recently, and the city’s “soft patch” seemed to be over.
Wellington also bucked its recent weak trend in February, with Porirua and Wellington City holding steady, and Kāpiti Coast, Lower Hutt, and Upper Hutt all increasing.
He acknowledged not everyone would think the increase was welcome.
“After all, there’s always two sides to the coin when it comes to house prices, and aspiring buyers would no doubt be happier if they were flat or falling.
“The general message is there are signs of upturn coming through but they may not be a straight line and may not be on the scale seen in the past.”
-RNZ
