Canterbury house price boom 'slowing'

NICOLE MATHEWSON
Last updated 17:30 10/02/2014

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House prices in Canterbury are continuing to rise, but the growth may finally be slowing.

New data from state-owned valuer Quotable Value (QV) shows the average value of a house in Christchurch is $456,131 - up 2.6 per cent from three months ago and 12 per cent on the same time a year ago.

QV research director Jonno Ingerson said house values were still increasing, but the rate of growth had ''slowed considerably'' over the last month.

Although it was early to claim a trend, Ingerson said the timing aligned with new restrictions on loan-to-value ratios, which had reduced the number of first-home buyers active in the market and had increased caution among all buyers. 

It was likely that a predicted increase in mortgage interest rates in the near future was also responsible for slowing down house values, he said. 

''This caution is offsetting any potential upward pressure on prices due to a lack of listings in many areas.''

QV Valuer Daryl Taggart said Christchurch's property market had been relatively quiet over the holiday period and there had been a ''noticeable flattening'' of values in the Selwyn District, with a rise of only 1.1 per cent over the last three months. 

''A lot of people have had to spend a lot time trawling through listings and going around open homes. Some people [may have] taken the Christmas period to have a bit of a break.''

Taggart said there had been a shift in parts of Christchurch that had been quiet after Canterbury's earthquakes, such as the eastern suburbs (up 8.6 per cent in the last year), as there was ''still not a lot of choice'' in the city's overall property market for prospective buyers. 

''There's still a lot of work on, but we're seeing a lot of sales of properties that have been repaired and there should be no reason why a homebuyer shouldn't buy a property that has been repaired.'' 

Elsewhere around the South Island, Dunedin's property market was showing reasonable demand, with values up 2.5 per cent compared to a year ago, while Queenstown's values grew 5.6 per cent in the same period and Westland grew 6.9 per cent. 

However, declines had been seen in some regions over the last year, including Southland (-4.2 per cent), Invercargill (-0.4 per cent) and the Buller district (-6.9 per cent).

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