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average national house price increases for first time since 2021

The average cost of a New Zealand home increased by 0.5 percent in August, to $893,639 (file image). Photo: RNZ / Nate McKinnon

For the first time since late 2021, the average house price nationwide has gone up.

The average cost of a New Zealand home increased by 0.5 percent in August, to $893,639.

Quotable Value operations manager James Wilson told Morning Report the increase "continues to be fuelled by the lower end of the market - the first home buyers who have remained active and are propping up the market".

"Overall, we are seeing that return to a more positive mindset amongst more and more buyers.

"That's how we can sort of call now that we are at a bottom. I don't think that we can call that we're at a bit of a bounce-back point. I think the scene is going to be flat to positive for the next three to six months."

He said for most areas, prices were not back to where they were pre-pandemic.

"We are still looking at quite significant reductions in terms of from the peak, places like Wellington for example have come back around 20 percent from the peak and they're still down just under 10 percent if you look at the year-on-year growth."

He said places where there was strong entry-level competition: Parts of the Mackenzie country and wider Canterbury, Westland District and Queenstown Lakes, "they are now back to that level we saw coming into Covid or close enough to it".

On the other hand, he said investors had taken a cautious approach as have mum-and-dad-style homeowners. "So within that group, that's where that mindset is beginning to shift. So we are seeing them adopt positions of 'we know where interest rates are, they really aren't going to get or shouldn't get significantly worse ... and they're probably likely to stay where they are, so it's probably time to consider looking to buy'.

"We still are seeing new listing numbers reduced in the last four to six weeks."

QV house price index - Sept 2023

QV house price index - Sept 2023 Photo: Supplied

Values continue to track downward across most of the main urban areas, with Tauranga (0.6 percent), Marlborough (0.2 percent), Christchurch (0.1 percent), Queenstown (0.8 percent), and Invercargill (1.5 percent) in the black this quarter.

The latest QV House Price Index shows the rolling three-monthly rate of reduction has slowed in Auckland (-0.5 percent), Wellington (-0.6 percent) and Palmerston North (-0.3 percent), and increased by less than a percentage point in Whangarei (-2 percent), Hamilton (-0.7 percent), Rotorua (-1.4 percent), New Plymouth (-0.1 percent), Napier (-1.6 percent), Hastings (-2.5 percent), and Dunedin (-1.7 percent).


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