PHOTO: May QV data shows growth slowed in April to May. Photo credit: Getty.
House price growth has slowed across 14 out of 16 New Zealand cities over the last two months, a property price report shows.
Quotable Value (QV) house price index data for May shows that over the last three months to May, the national average house price increased by 2.4 percent to $739,539. The growth rate is down from 3 percent in April. The year-on-year increase of 7.7 percent is also below the growth rate of the previous month.
QV general manager David Nagel, said that an initial bounce in sales volumes after lockdown was a likely result of pent-up demand. Although COVID-19 restrictions have eased under alert level 2, numbers are down and buyers are cautious, the effects of which aren’t yet captured in the data.
“The key point from the QV house price data this month is the gradual decline in quarterly growth in May, with 14 of the 16 major cities we monitor showing a reduction in the rate of growth since April.”
“This trend is likely to continue as a greater proportion of post-lockdown sales are used in the HPI calculations,” Nagel said.
He said the number of sales during April and May were well below normal levels, skewing the pricing data towards early to mid-March, when volumes were higher. A disconnect in price expectations between sellers and buyers suggests the industry is “on the brink of a material decline” similar to the 10 percent fall following the 2008 Global Financial Crisis (GFC).
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