Jan. 10 (BusinessDesk) - New Zealand property values rose 5.7 percent last year, driven by gains in Auckland and a recovery in Christchurch, and the housing market in the country's biggest city is set to keep climbing, according to Quotable Value.
Property values were 1.5 percent in the three months ended Dec. 31 from the same period a year earlier, rounding out the annual gain to 5.7 percent, state-owned QV said today. That's 2 percent above the previous market peak in late 2007.
The increase in national values was predominantly driven by Auckland and to a lesser extent Christchurch," research director Jonno Ingerson said. "These were also the only two areas to have consistently increased while the rest of the country varied throughout the year."
New Zealand's property market regained some vigour in 2012 after several years of being in the dumps, with an increasing Auckland population swelling demand against the backdrop of a limited supply. The lack of supply has become a concern for politicians, who are looking at ways to stoke new building.
QV's Ingerson said the lack of properties on the market was "one of the defining features of 2012" with buyers struggling to find suitable properties.
Those supply issues will likely push up Auckland property values further this year with the city expected to see more migrants arriving than people leaving.
Auckland property values are 11.1 percent above the last peak, and what used to be Auckland City now exceeds the 2007 values, even when adjusted for inflation.
Wellington property values are expected to stay flat this year having suffered in recent years from restructuring and job losses in the public sector, while Christchurch property values are predicted to keep growing as demand outstrips supply.
Property values in the country's provincial centres increased at a slower pace than the national average and are expected to stay flat this year.