PHOTO: Latest CoreLogic HPI figures show national growth dropped below 1 percent in February. Photo credit: Getty Images.
National property values grew by 0.8 percent in February, marking the lowest monthly gain since September 2020, according to latest figures.
Released on Wednesday, the CoreLogic House Price Index (HPI) shows the average New Zealand property is valued at $1.036m, up 25.2 percent annually and up 4.9 percent over the quarter.
On a monthly basis, the 0.8 percent February gain is down from 2.1 percent in January, having fallen from the peak growth rate of 3.1 percent in April 2021, CoreLogic figures show.
As the HPI includes sales data from the previous three months, CoreLogic said February’s still positive result could be attributed to strong sales evidence before Christmas.
Analysis of recent sales shows sentiment is “changing rapidly”, with vendors (sellers) “unable to achieve the prices of 2021”.
Referring to the sharp drop in the monthly rate of growth as indicating a “clear change in trend”, CoreLogic head of research Nick Goodall said the HPI is expected to dip further over the coming months.
“Regional differences will also start to appear, as local economies, recent first-home buyers and property investors all react differently to the changing environment,” Goodall said.
CoreLogic expects further official cash rate hikes and tighter credit controls, including loan-to-value ratio (LVR) restrictions and tougher lending rules under CCCFA changes, to weigh on the market.
Reserve Bank data shows residential mortgage lending was $7.1b in December, showing a steady decline from $9b in June 2021. The February Monetary Policy Statement shows the Reserve Bank is forecasting annual house price growth to decline by 5.1 percent by 2023.
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