New Zealand house prices fell 7.4% last year as the first recession in a decade and tighter lending criteria sapped demand for property. Sales in December tumbled 23% from a year earlier.
Thursday, January 15th 2009, 12:03PM
by The Landlord
The decline is the largest since Quotable Value New Zealand began its series in 2005, according to spokesman Mark Dow. The property figures follow a survey this week showing a slump in business confidence that has stoked expectations the central bank will slash interest rates again this month.
“As the economy weakens and affordability becomes a real issue, first home buyers are usually the first to suffer,” Dow said. “During 2008, the number of house sales fell dramatically and the proportion of lower-value properties selling significantly decreased.”
The average sale price for December rose slightly from the previous month and was down on a year earlier at $378,605, Quotable Value said today. Its figures measure prices in the three months through December from the same period a year earlier.
All the main centres showed further declines in property values in December. In the Auckland area values dropped 8.0% from the 7.4% reported in November. Hamilton values fell 9.3% from 8.5% the previous month, Tauranga fell 9.0% from 8.4%, and the Wellington area dropped 6.9% from 6.0% in November. Christchurch and Dunedin followed the same trend, dropping 8.0% and 7.7% respectively.
Most of the main provincial cities followed the national trend with property values easing further. Whangarei dropped 8.6%, Napier 8.1%, Nelson 7.6%, and Invercargill fell 9.1%.
However, a number of areas bucked the trend, most notably popular summer destinations, like Queenstown whose property values dropped to 10.6% from the -12.5% reported in November, and Gisborne to 5.8% from 9.6% in November.
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