Region's house price falls less than most

The global financial crisis is hitting homes, although the Nelson region is showing some resilience, with property values not falling as far or as fast here as in other centres.

The latest Quotable Value figures, out on Monday, show that Nelson city values dropped 4 percent and Tasman values dropped 2.1 percent during the three months ending September, less than the national average of 5.8 percent and better than New Zealand's main cities and most provincial centres.

QV spokesman Blue Hancock said the region's statistics were reflected on the street.

"There's still activity out there. Nelson people are always very resilient when the market crashes. If they don't need to sell, they dig in and hold on."

QV said increased optimism last month had "evaporated" as the country moved into recession. The global credit crisis, usual lack of activity before an election and significant tightening of lending policies is killing any expectation of a spring resurgence.

Auckland property values are down 7 percent, Wellington's 5.4 percent, Christchurch's 7.1 percent, Hamilton's 8.8 percent and Dunedin's 8.5 percent. Provincial centres are taking the biggest hits, with Gisborne sliding 10.1 percent and Palmerston North 9.4 percent. Invercargill is one of the few places to fare better than Nelson, recording a 1.6 percent decline.

The average September sale price in Nelson was $344,578, while Tasman's was $361,589. The national average was $379,854.

The latest Real Estate Institute figures show there was a 22 percent increase in property sales in the region between August and September, but the 134 sales last month was still 9 percent less than in the same month last year.

The drop in the New Zealand dollar has improved business for the region's exporters, and Mr Hancock believes it may be aiding the region's resilience.

"I think the dollar might feed into the residential market more because of overseas people looking to come here and buy," he said.

But Mr Hancock has changed his own predictions for the region's property market following the latest international financial turmoil. He said he was now expecting to see "more softening of the market" rather than price stabilisation. How much would depend on overseas rescue packages being put together now.

"If people start losing their jobs, they won't be able to hang on to those housing mortgages that are up to the hilt."

- © Fairfax NZ News