QV WELLINGTON - New Zealand house price growth slowed for a fourth consecutive month in March, as lending restrictions and rising interest rates weighed on the market, the government property valuer said on Monday.
Quotable Value's (QV) residential property index rose 8.8 per cent in the year to March 31, compared with a 9.3 per cent annual rate in February.
The index is now 12.6 per cent above the market's previous peak in late 2007, with signs that activity was slowing in the biggest city Auckland, which had been driving national figures. "The LVR speed limits and the Reserve Bank signalling further interest rate hikes is likely to be contributing to a levelling off in the growth of property values in Auckland and for the first time in more than two years we are seeing a decrease in some areas of that market," said QV spokeswoman Andrea Rush.
Last October, the Reserve Bank of New Zealand imposed limits on how much banks can lend to borrowers with low deposits in an attempt to counter house price inflation.
The central bank went on to raise its cash rate last month by 25 basis points to 2.75 per cent and signalled further rate rises towards 5 per cent over the next two years.
House prices in the Auckland region were 14.3 per cent higher in the year to March from a 14 per cent rise the month before, while prices in Christchurch rose 8.3 per cent, from 11.1 per cent in February.