Cheap houses lure investors to Dunedin, Wellington heats up, Auckland cools
The home of the scarfies has become a new haven for property investors, as buyers continue to struggle to come up with house deposits in other areas around the country.
The average house value in Dunedin sits at $354,133, making it the new hot spot for investors who are finding it easier to buy a house, new figures show.
QV Dunedin registered valuer Duncan Jack said there had been no sign of the traditional Christmas period slow-down in the market.
"Value levels continue to steadily increase, sales activity levels also remain strong and properties selling quickly."
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"There is anecdotal evidence at the end of last year of multiple offer scenarios and high numbers at open homes continuing to be commonplace."
QV national spokeswoman Andrea Rush said: "This is likely to be due to the fact the Dunedin housing market offers a much lower entry level and price point than the other main centres, thus it's easier for investors to find a 40 per cent deposit to purchase there."
Meanwhile, house prices in Wellington continue to outpace those in Auckland.
House values in the capital have risen 20.5 per cent year-on-year, taking the region's average price to $574,410.
QV registered valuer David Cornford said the effect of the earthquake "appears to have largely disappeared in the housing market".
"[However] many vendors still haven't had time to catch their breath with many planning to hold off listing their property until the New Year.
"Strong prices are still being achieved and property values continue to increase, albeit at a slightly lower rate."
The investor market had slowed - though only marginally - since the middle of the year with the introduction of LVR (loan-to-value ratio) restrictions, Cornford said.
"However, first home buyers remain very active and seem to be taking advantage now there are fewer investors in the market."
In Auckland, house values have increased 12.2 per cent year-on-year - the slowest rate since January last year.
QV Auckland general manager Jan O'Donoghue said activity and demand in the market had continued to slow during December.
"This comes on top of the slowing in the market brought on by the introduction of the new LVR changes in the last quarter of the year which has led to price drops in some sectors of the market."
"With interest rates set to rise further during 2017, it appears some investors are choosing not to buy more property as they have lower expectations of potential capital gains during 2017."
Nationally, the average house value now sits $627,905 - an increase of 12.5 per cent over the past year.
Regional average house values
Auckland: $1.047 million
New Plymouth: $411,160
Palmerston North: $345,068
Queenstown Lakes: $1.022m