Wellington Scoop

Wellington property values keep going up – 7.4% increase in city in 12 months

News from QV
New Zealand’s ‘more affordable’ main centres, particularly the wider Wellington region and Dunedin, continue to show a strong rate of growth in a cooling market. The wider Wellington region, with quarterly growth of 4.0%, continues to see values steadily increase as buyers continue to be attracted to the more affordable outer city areas such as Porirua and the Hutt Valley.

The latest QV House Price Index shows nationwide residential property values have increased steadily over the past year by 3.5% and by 1.3% in the three months to November. The nationwide average value is now $681,545.

Values across the whole Wellington Region rose 8.1% in the year to November and increased 4.0% over the past quarter and the average value is now $685,387.

Wellington City values increased 7.4% year on year and by 3.5% over the past three months and the average value there is now $805,442.

Values in Upper Hutt rose 8.8% year on year and 2.4% over the past three months; Lower Hutt rose 9.2% year on year and 5.8% over the past quarter; Porirua rose 9.3% year on year 4.6% over the past quarter. The Kapiti Coast rose 6.5% year on year and 2.2% over the past three months.

QV Wellington Senior Consultant, David Cornford said: “Record low interest rates and low levels of inventory are underpinning moderate value growth, particularly at the low-to-mid priced section of the market.”

“The recently announced easing of LVR (Loan-to-Value Ratio’s) for both first home buyers and investors is likely to inject a bit more activity into the market in the New Year, however it’s a relatively minor change to the current rules and we are unlikely to see a significant impact on value levels.”

“There is plenty of residential development going on throughout the region ranging from single dwelling developments through to large-scale subdivisions and apartment buildings. These developments continue to provide additional supply, however this is being offset by population growth which continues to fuel demand.”

“Many of the new homes being constructed in the region will be out of the price range for first home buyers, however it will free up cheaper homes for these buyers.”

“Rents have significantly increased in the Wellington region over the last 12 months, particularly in the Hutt Valley and Porirua, and we’re likely to see a continuation of this upwards trend into 2019 until supply constraints are properly addressed.”

“Investors continue to be active in the market, attracted by high rents which are trending upwards. At the same time, we’re seeing some investors offloading their investments due to impending legislation changes.”