According to the latest QV HousePrice Index, the average value of New Zealand residential homes continues to increase and has shown over the last three months a rise of 6.8 per cent to the end of February.
The range for the main regional centres showed increases from 2.1per cent in Invercargill to a high of 9.4 per cent in Palmerston North.The twin Hawke’s Bay cities of Napier and Hastings aren’t far behind, with both cities showing quarterly growth of 8.9 per cent.
In the main city centres, average values were up by 6.4 per cent in Auckland, 7.9 per cent in theWellington region, 6.1 per cent inChristchurch, and 5.6 per cent in Dunedin.
All of these numbers represent an increase of 15.9 per cent year-on-year. An increase from annual growth of 15.1 per cent last month for residential property.
With the re-introduction of Loan-to-Value Ratio (LVR) restrictions on new mortgage lending, with investors required to have a minimum 30 per cent deposit from 1 March (increasing to 40 per cent from 1 May) and most owner-occupiers needing a 20 per cent minimum deposit, could see a dynamic market change, with the first home buyer having more opportunity together with those who are considering upgrading. What effect the LVR reintroduction will have on investors is unknown, however, given the current yield and return against what other offerings are available, property will still remain a strong class of asset.
While the impacts are not immediately known, the recent change in AlertLevel restrictions combined with the consequence of vaccine roll outs and increased confidence that there is finally an end in sight to the worst effects of the COVID-19pandemic, may give the ability forNew Zealanders to move home from overseas with increasing confidence.Will this add pressure to the housing market. When we look at the smaller provincial centres, there have been some dramatic increases and in the North Island, Wairoa leads all provincial centres this month. The average house price in the Hawke’s Bay town has increased by almost 17per cent to $371,465 in just three months. It’s followed by Ruapehu –last month’s leader – on 14.8 per cent growth for the quarter, and South Taranaki in third place at 13.5 percent.
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