Wellington's property market is largely moribund, but the city's eastern suburbs are hot property, the latest figures from valuation firm QV show.
Values from Kilbirnie to Seatoun leapt 5.3 per cent over the past year to an average of $555,409, more than double the average increase for the city or region.
Values for the region increased by 2.1 per cent to $446,437, compared with a national average gain of 4.6 per cent to $423,667.
But nearly all of the region's gain took place in the second half of last year, QV said.
Prices throughout the region remained flat in July with price increases lagging behind the national average and remain 5.7 per cent below their 2007 peak.
But QV research director Jonno Ingerson said a growing shortage in new listings was beginning to put pressure on prices.
Nationwide property values are just 0.8 per cent below the previous market peak in late 2007, largely because of relatively few houses available for sale, creating a sellers' market and driving prices up.
“Wellington is showing the first signs of heading that way too,” Mr Ingerson said.
Grant Henderson, at real estate firm Bayleys, said the eastern suburbs, particularly Lyall Bay, Miramar and Kilbirnie, were popular with people looking for flat land and easy access to schools and shopping.
But a lack of listings was driving up prices, in some cases nearly $200,000 above the rateable value for a four-bedroom house in the area.
“They are getting money that is really close to what we used get in Seatoun for houses,” he said.
However, generally the Wellington market was “a bit slow”.
Wellington city prices were up 2.4 per cent over the past year to an average of $512,580.
But Henderson said the average sale prices could be misleading.
With the exception of some strong pockets in the market “nothing has actually gone up”.
The average sale price was rising because investors and first-home buyers were not buying at the cheaper end of the market and houses above $1.6 million were also not selling, he said.
“That means that the average price statistically has risen, not that the average house price has risen.”
Lower Hutt prices gained 1.2 per cent to $370,590, Upper Hutt was ahead 1.9 per cent at $353,503 and Porirua up 2.2 per cent to $402,015.
In the Wairarapa, Masterton prices fell 2.4 per cent to an average of $234,358, but Carterton rose 6.1 per cent to $248,225. South Wairarapa prices were up 3.1 per cent to $311,649.
Real Estate Institute figures, also out yesterday, show Wellington region's median sale price of $365,000 in July was unchanged from the same month last year. However, an extra 92 properties sold this year compared with July last year.
The institute said sales volumes had improved, particularly in eastern and southern Wellington, the Hutt Valley and the Wairarapa, but overall the region remained flat.
- © Fairfax NZ News
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