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QV House Price Index, April 2021: Tax changes yet to dampen red-hot housing market

Just over a month has passed since the Government announced measures aimed at dampening the rampant growth of the property market, and yet the latest QV House Price Index data shows the market hit a new high in April.

The average value increased 8.9% nationally over the past three-month period, up from the 7.8% quarterly growth we saw in March, with the national average value now sitting at $913,209. This represents an increase of 21.4% year on year, up from 18.2% last month.

The average value in the Auckland region now sits at $1,306,913, up 8.2% over the last quarter, with annual growth of 19%, up from March’s year-on-year growth of 16.1%.

Of the 16 major urban centres we monitor, all except Napier City and Queenstown Lakes District are showing an increase in quarterly growth compared to last month. However, Napier is still showing the strongest gains in value, followed closely by Hastings, with 14.2% and 14% value growth respectively over the past three months.

QV general manager David Nagel said: “We’re hearing a range of anecdotal evidence of investors disappearing from auction rooms and even a decrease in first-home buyer presence. And while less properties may be selling under the hammer, the majority are still being sold at prices that are at least as strong as before the tax announcements were made at the end of March.”

“We’re starting to see some interesting regional trends emerging, with the strongest value growth occurring in the southernmost regions of the North Island. The Hawke’s Bay region, Manawatu-Wanganui and also the greater Wellington region are all showing very strong month-on-month value growth with Hawke’s Bay leading the pack at 4.9% monthly growth. The two southern regions of Otago and Southland are showing much more conservative monthly growth of just 2.1% and 2.5% respectively,” he said.

“We’ll all just be guessing the impacts of the recent tax changes until we get another couple of months of sales data to analyse. But there’s certainly an expectation that we’ll see at least a slowdown in the rate of value growth, with potentially less investors and maybe a few more first-home buyers entering the market over the coming months,” Mr Nagel added.



House prices have risen by an average of 8.2% this quarter across the Auckland region − up from the 7.2% value growth we reported last month − with the average house price now sitting at $1,306,913.

The average house price is considerably higher in Auckland’s central suburbs ($1,524,149) and on the North Shore ($1,478,867). Rodney ($1,200,127), Manukau ($1,152,181), Waitakere ($1,053,677), Papakura ($902,832), and Franklin ($840,173) all have average house prices below the regional average.

The largest average price gain this quarter was in Papakura (10.4%) once again. It was followed by Waitakere (9.6%), Rodney (9.4%), Manukau (8.6%), Franklin (8.4%), central Auckland (7.1%), and the North Shore (7.1%).

QV senior consultant Rupert Yortt commented: “There has been little in the way of a slow down after last month's Government announcement, but the market does appear to be less frenzied now than it was earlier this year.

“Some buyers have adopted a ‘wait and see’ approach, which has resulted in less attendance at open homes and auctions. This could potentially indicate that the balance between vendor and purchaser expectations may be switching slightly. Overall, I expect to see the market stablise further as we head into winter.”

Mr Yortt said properties with development potential continued to be the top performers throughout the region, while fringe central areas such as Avondale and Mt Wellington have also continued to attract strong levels of interest from first-home buyers in particular.


Whangarei’s residential property market was even hotter in April than it was the month prior, with the average house price rising 3.8% to $717,574. That figure is now 10.4% higher than it was three months ago and a remarkable 23.4% higher than at the same time last year.

Even further north, house prices in the Far North district have increased by 8.1% this quarter (up from the 7% we reported last month) and by 17.2% over the last 12 months. Meanwhile, property prices have increased by an average 19.6% in Kaipara since the same time last year.


Tauranga is still one of New Zealand’s leading cities for rapid property market growth at present, despite some predictions that it was slowing.

In fact, Tauranga’s average house price is rapidly closing in on $1 million. At 7.8% growth for the quarter − including 3% for the month of April − it looks as though the city should reach that mark later this month. As it stands now though, the average price of a home here is currently $992,087.

Although confidence in the Tauranga economy remained strong, local QV property consultant Derek Turnwald advised that a number of factors would still likely slow the city’s rampant house price growth in the future. “With the gradual removal of interest cost deductibility for investors it’s highly likely that investor interest will decline now,” he said.

“Agents are receiving less enquiries from New Zealanders living overseas, possibly as a consequence of vaccine rollouts and increased confidence that there is an end in sight to the worst effects of the Covid-19 pandemic. Plus there’s a sense that FOMO (fear of missing out) is being slowly replaced by a fear of paying too much for a property.”

Following the Reserve Bank’s recent announcements, Mr Turnwald expected the central bank to implement additional controls and policy changes if recent changes are not effective in cooling the country’s overheated property market.


The average price of a home in Hamilton is now $792,772 − a significant 22.7% higher than at the same time last year. House values increased by an average of 8% this quarter, which is only slightly higher than the 7.7% we reported last month.

At 9.5% growth for the quarter, house prices in Hamilton’s north east have risen the most since February this year, followed by the south west (8.6%) and north west (7.7%). The smallest amount of house value growth this quarter was in Hamilton’s south-eastern suburbs (5.5%).

Across the wider region, Taupo has experienced the strongest three-month increase with the average price rising 13.6% to $754,700. This is 31% higher than at the same time 12 months ago. Waitomo has also seen a strong 12-month increase − up 29.4% to $350,383.

Local QV property consultant Jarrod Hedley commented: “Agents are reporting good interest in residential properties across the region but not at the same levels as experienced earlier on in the year. This is yet to have any impact on value increases that we continue to see in the Waikato.”


The average price for a home in Rotorua is now $663,642 − 17.5% higher than it was at the same time last year, and 6.5% higher than it was just three months ago. Residential property prices increased by an average of 3.2% in April, up from 0.9% the month before.

Though demand for housing remained high and supply remained low in the local area, QV property consultant Derek Turnwald said the Government's moves to increase the bright-line test and remove interest cost deductibility would have a strong impact on investor interest in the market.

“Rotorua has become popular with local and out-of-town investors in recent years due to the comparative affordability of housing and high yields. On the plus side, first-home buyers and owner occupiers purchasing new property will have greater opportunities to purchase without investor competition,” he said.

“However, it’s likely that there will be even fewer rental properties available in Rotorua in the future and this could lead to greater numbers of homeless people.”

Meanwhile, residential property listing periods were short, with most resulting in multi-offer sales.


New Plymouth’s residential property market remained red hot in April. Its average house price increased by 9% for the quarter and 23.3% over the past 12 months to $636,439. Meanwhile, house prices in the neighbouring districts of Stratford ($445,605) and South Taranaki ($398,793) have been even more buoyant, increasing by 24.3% and 33.2% respectively over the past 12 months.

Hawke’s Bay

New Zealand’s rampant housing market has been hottest in Hawke’s Bay this quarter, with house prices in Napier ($798,568) and Hastings ($797,034) surging by 14.2% and 14% respectively.

Annually, house prices have increased by a massive 32.3% in Hastings and 27.3% in Napier − more than almost anywhere else.

Local QV graduate valuer Damian Hall said the new regulations announced by the Government back in March had yet to influence swelling value levels. “The talk is that investor interest has dropped but not enough to influence overall demand − hence why prices are still rising,” he said.

“As we head into the winter months and people’s urge to bunker down and ‘wait until spring to sell’ attitude becomes apparent, the pressure on supply levels may worsen and prices may continue to rise even further. In the meantime, strong demand is putting pressure on low supply levels across the board.”

Palmerston North

Palmerston North’s residential property market shows no signs of slowing, with the average house price rising by 10.9% this quarter to $687,537. That value is a remarkable 30.8% higher than at the same time last year.

Local QV property consultant Olivia Roberts commented: “The market is still very strong with increases in property prices across the Manawatu region. Sales volumes have been low and we continue to see buyer panic in the market as a direct result of a lack of supply. Real estate agents continue to report strong interest with multiple offers being received.”

However, she warned that the market could still be affected by a range of factors − most notably the Government’s extension of the bright-line tax timeframe and the end of interest tax deductibility. “We’re yet to see what effect this will have on the property market, particularly investors' response to these changes,” she added.


The latest QV House Price Index shows the average house price across the Wellington metropolitan area increased by 4.3% in April, 10.3% for the quarter, and a significant 28.5% over the last 12 months. The average house price is now $1,028,913.

The largest rise in average house price this quarter occurred in Hutt City (13.4%), while Porirua, Upper Hutt and Wellington city all saw increases of 8.6%, 11%, and 9.3% respectively. In terms of annual price growth, Hutt City and Upper Hutt lead the way at 34.6% each.

Despite the rapid growth, real estate agents have reported slightly less attendance at open homes in recent weeks, with some investors looking to take a step back in response to the Government’s recent housing announcement.

Local QV senior consultant David Cornford commented: “Properties are continuing to sell well despite there being fewer investors in the market and values are holding firm. But it does feel like we could be starting to enter a more stable period in the market after close to 12 months of rapid value growth.

“Like much of the country, Wellington is underpinned by a shortage of supply and the recent price increases are a reflection of this. We’re also seeing strong interest from both first-home buyers and investors for off-plan townhouses.”


It’s been another busy quarter for Nelson’s residential property market with the average house price rising 6.3% to $765,247.

QV senior property consultant Craig Russell said the property market continued to be driven by a lack of supply coupled with pent-up demand. “Although it’s still a strong market we are starting to see purchasers becoming more selective, with investor activity showing signs of weakening anecdotally,” he said.

“Multiple offer situations remain commonplace but we are no longer seeing such exorbitant prices being paid motivated by the fear of missing out. That’s been replaced with a fear of paying too much in some cases now.”


House prices continue to rise rapidly in Canterbury and Christchurch in particular, with the average price rising this quarter by 8.9% and 9.5% respectively. The average price of a home in the region is $594,279; in Christchurch, that figure is $624,285.

Annual price rises have been highest in Christchurch’s eastern suburbs (24.7%), in the hills (22.3%), and out on the peninsula (22.1%). Across the wider Canterbury region, house prices have also risen swiftly in the districts of Hurunui (19.2%), Ashburton (17.3%), Waimakariri (16.6%) and Selwyn (16.4%).

Local QV property consultant Olivia Browne commented: “We’re still seeing a strong steady increase in values across the board, which can be attributed to the continued lack of stock available, low interest rates and sustained demand. We’re also seeing a shorter number of days to sell and a lower sales volume over the last month − all putting an upward pressure on values.

“I expect we’ll see more of the same in the Christchurch market with the new Government regulations a few months away from having an impact.”

In the meantime, she said new-build activity continued to be strong and she anticipated that demand would continue. “That will put even more upward pressure on house prices due to increasing land values, rising construction costs and new Government regulations. We may even see a shift in value trends between existing and new builds.”


Dunedin’s residential property market currently shows no signs of slowing down, with property prices gaining a little bit more speed in April − rising 2.5% last month, up from 1.8% the month before.

The average price of a home in Dunedin is now $659,447, which is 7% higher this quarter and 17.8% more than the same time last year. Much of that growth has occurred on the coast and peninsula, where house prices have shot up 14.3% in three months and 24.6% over a full year.

QV area manager Tim Gibson commented: “Despite the Government’s new housing package being announced in March, demand has continued throughout all residential sectors of the market during April.

“A lack of residential listings and available land continues to be the primary driver of the market right now. As a result, lesser-quality land is becoming more attractive to prospective developers as supply issues continue to bite.”

Queenstown Lakes

The latest QV data shows a 6.1% rise in Queenstown’s average house price this quarter and an increase of 11% over the past 12 months. It now sits at $1,383,181.

Despite the lingering effects of international travel restrictions on the local economy, QV property consultant Greg Simpson said the residential property market had stabilised. “There are two economies in the district – the tourism-based industries that are operating under extremely adverse trading conditions and the rest, which appear to be operating at near normal activity levels,” he said.

“The construction and real estate sectors are even prospering right now, with high demand for property and strengthening value growth. The Government's latest housing policy should also help to accelerate the building of new houses, which is good news for these industries.”


The average house price in New Zealand’s southernmost city has increased by a whopping 9.2% this quarter – up from the 6.8% value growth that we reported last month – to $436,759. That figure is now 14.1% higher than at the same time last year.

The local QV team reported seeing continued strong demand within the Invercargill housing market, particularly within the “relatively affordable” $300,000-$450,000 range. “Multiple offers are common, often resulting in prices above initial asking price,” said property consultant Andrew Ronald.

“There was considerably less investor activity over April, but there are still high numbers of first-home buyers competing for homes within this price range.”

Provincial centres, North Island

Wairoa tops the list of provincial centres in the North Island with prices rising by an average of 21.8% over the last three months. It’s followed by Carterton (last month’s leader) on 17.7%, and Rangitikei (15.8%).

Over the 12 months ending April 2021, house values in Wairoa have increased by an astonishing 46.7% − the most nationally by far. Last month’s leader, Carterton, has also experienced a large jump in average house price of 40.2%.

Provincial centres, South Island

In the South Island, Buller leads all provincial centres with house prices rising 16.6% this quarter. Marlborough and Grey District aren't far behind with average house price rises of 13.7% and 13.1% respectively.

Buller also tops the list for annual house price growth at 35.6%. Once again, it’s followed by Marlborough (29.9%) and Grey District (25.7%), which just edges out Gore (25.6%) by a fraction of a percentage point.

You can now view and keep track of all these value movements and more via our interactive QV House Price Index.