House price fall from peak hits double digits in March, QV report shows

National house prices were down 9.3% in the three months to March from the same period a year ago and are down 10.1% from their peak at the end of 2007, figures from government-owned valuation service Quoteable Value (QV) show. This fall in the three months to March was an acceleration from the 8.9% fall seen in the three months to February. Prices fell most in Auckland and Northland, while prices in Wellington and dairy farming provincial cities fell to a lesser extent. QV Valuations said sales volumes had increased in March, but it was cautious about this rebound in volumes carrying through into the traditionally quieter winter months. House prices were showing signs of stabilising in some areas, QV Valuations national spokesman Blue Hancock said. "Our analysis shows that property values have dropped 9.3% over the last year, worse than last month. However, this further decline is being driven by falls across the Auckland region, particularly in Auckland City and Manukau. Many other areas of the country are beginning to see property values flattening, particularly in provincial cities and across parts of the Wellington area" said Hancock. "Despite signs of stability in property values across some areas of the country, there remains widespread uncertainty over what the coming months may bring. The number of sales traditionally drops during autumn and winter, but how interest rates impact market activity and the extent to which broader economic factors, in particular declining job security, will affect the property market remains unclear" said Hancock. Auckland prices were down 10.1% from a year ago, while Wellington prices were down 8.7% and Hamilton prices fell 9.3%. Christchurch prices were down 9.7% from a year ago. QV Valuations Auckland valuer Glenda Whitehead said values were beginning to stabilise or level off. "Enquiry levels are up in most areas, with people now wanting to make decisions, which certainly didn't seem like the case late last year. What are seen as low interest rates are definitely one of the drivers behind this, however caution remains due to wider economic factors such as job security," Whitehead said. "Various real estate agents around the region are reporting that their stock levels are now low, having cleared old listings, and it seems that getting new listings is somewhat difficult. Perhaps low interest rates are making it easier for many to sustain their present situations, and maintain the status quo," she said. "Like last month, we have continued to have reports of strong activity at open homes. There are also multi-offers on quality property, and competitive bidding at particular auctions. This is all positive news after a long period of negativity. But winter will be telling; if listings are low, it could make for another slow season," she cautioned. "Some investors are on the prowl again, but feedback indicates they are scoping the situation and only stepping in where the numbers stack up in their favour, or they can get a steal. We have seen an increase in clientele returning from overseas due to lack of jobs (UK, Europe, Australia), but it is hard to tell if these few represent a wider trend."