Queenstown, Central Otago and Dunedin remain well above the national average for house values in May, which nationally gained almost 10% in value during the past year. However, Quotable Value's statistics for May showed annual gains were still looking relatively strong, but quarterly gains were on the wane.

Of the 102 districts, towns and cities analysed by QV for May, just five posted price declines against 12 months ago; Buller down 10.6% and the other four down less than 2%, being Christchurch hills and Banks Peninsula, Ashburton and Waimate.

While the annual change suggests little let-up in house value gains, QV's quarterly data shows the majority of the 102 areas made just 1%-3% gains during the past quarter, indicating a plateauing of values is under way.

The country's problem hot spots of Auckland and Queenstown Lakes respectively booked quarterly value gains of just 0.1% and 1.2%; having booked rampant increases in recent years. Both centres' averages value remains above $1million for May.

QV national spokeswoman Andrea Rush said the house price index for May showed nationwide residential property values increased 9.7% during the past year - the slowest annual rate in two years.

Nationally, the quarterly values rose by 0.4%, with the nationwide average value now $634,018, Ms Rush said in a statement. ''Nationwide value growth continues to ease back due to lower demand in the housing market caused by the latest round of [Reserve Bank] loan to value ration restrictions and tougher lending criteria from the banks as we head into the winter period,'' she said.

QV Dunedin valuer Aidan Young said Dunedin's home values were continuing an upward trend, having risen 15.5% since May last year and 3.9% during the past three months, with the average value in the city now $373,810, up slightly from $371,700 the previous month. ''We continue to see steady demand across all parts of the Dunedin market,'' Mr Young said in a statement. Dunedin-coastal values saw the strongest growth, rising 6.6% during the past quarter and up 20.1% on a year ago, he said.

Ms Rush said in provincial South Island most areas saw values rise during the past year, with Central Otago up 20.3% and gaining 6.4% in the past quarter. She noted the MacKenzie district values rose 35.6% in the year and 9.6% over the past three months, while values in Westland were up respectively 11.4% and 5.7%.

Ms Rush said sales volumes were lower than this time last year, particularly in Auckland, and its market activity could remain subdued until after the election.

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