RTTNews - New Zealand's house prices climbed in July, for the third consecutive month, indicating an increase in buyer optimism and activity levels, the latest report from the Quotable Value said Monday.
Residential property values climbed 0.7% from June, and were up 1.3% from the low seen in April. The average sales prices increased to NZ$382,785 from NZ$378,535 in the preceding month.
Year-on-year, residential property values fell 5% in July, slower than a 7.1% drop in the preceding month.
The report said the volume of sales was above the historically low levels experienced last winter, but were still below the long-term average. Moreover, the increased number of sales continued to be driven by the lower end of the market, with more investors and first home buyers entering the market.
Sales activity remains at solid levels, particularly given the time of year. There are also signs that more vendors are putting their properties on the market. This is perhaps in response to reports of shortages of listings, signs that values have stopped declining, and increased buyer optimism and activity, QV Valuation Manager Glenda Whitehead said.
The market seems to have returned to some form of normality. Buyers are making rational, carefully considered decisions based more on fact than emotion, Whitehead added.
Meanwhile, QV indicated that although the activity was increasing at the lower end of the market, the values were increasing more in the middle value range of the market. Also, in some areas, a shortage of quality properties caused increased competition, and was possibly causing a short-term rise is sales prices.
Further, while values increased marginally over the quarter, it was unlikely to be the beginning of another boom, QV said. Low interest rates and a shortage of quality housing could keep the market active, but rising unemployment could drive down the market again, it added.
In other signs that the property market in New Zealand was showing signs of stabilization, a report by Barfoot and Thompson said last week that the housing market in Auckland was active, solid and with a sense of certainty in July, and with more sellers entering the market.
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