New Zealand house price growth quickest in nine months in March: QV

Residential houses can be seen along a road in a suburb of Auckland in New Zealand, June 24, 2017. Picture taken June 24, 2017. REUTERS/David Gray

WELLINGTON (Reuters) - New Zealand house prices grew at their fastest pace in nine months in March, supported by strong gains in smaller cities, data from a government property valuer showed on Thursday.

Quotable Value’s (QV) residential property price index rose 7.3 percent in the year to March, as it steadily recovered from a lull towards the end of 2017 when buyers held off on large investments during an uncertain election period.

The result compared with an annual growth rate of 6.5 percent in the previous month.

New Zealand’s housing market had raced along at double-digit growth rates in recent years as a housing shortage and record migration levels pushed up prices.

The nation’s new Labour-led government took the helm in October vowing to fix what it described as a housing crisis and was planning to introduce a ban on many foreigners from buying homes as well as widen taxes on investors this year. Both regulatory measures are currently being debated in Parliament and yet to be implemented.

Gains in March were led by surging prices in smaller cities, including the southern center of Dunedin, which posted a 9.4 percent rise.

House prices in the Auckland region, once the epicenter of house price inflation, were just 1 percent higher in the year to March, compared with a 0.8 percent lift the month before.

Reporting by Charlotte Greenfield; Editing by Shri Navaratnam