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QV House Price Index, April 2022: Rising interest rates starting to bite as downturn gathers pace


The latest QV House Price Index shows the housing market is under increasing pressure from rising interest rates. Loan affordability constraints are limiting buyers, and those who are in the market are spoilt for choice as listing levels far outstrip demand.

The average home decreased in value by 2.2% nationally over the past three-month period to the end of April, down from the 0.6% decrease in quarterly value change we saw in March, with the national average value now sitting at $1,040,927. This represents an average annual increase of 14%, down from 18.3% annual growth last month.

In the Auckland region, the average value now sits at $1,492.807, falling 3.1% over the last three-month period, with annual growth of 14.2%, down from the 18.6% we reported in March.

QV General Manager David Nagel commented: “It’s no surprise that the largest declines are occurring in locations that experience the strongest growth over the past couple of years. These markets were the first to become overheated and that makes them more susceptible to a value correction as rising interest rates, tightening credit and affordability concerns start to kick in.”

Palmerston North and Wellington are showing the largest three-month value reductions at 5.4% and 3.6% respectively. Dunedin and Hastings, both at 3.4% reduction in values, are not very far behind.

Only 5 of the 16 major urban areas that QV monitors have shown an increase in three-monthly house price value, with Marlborough (3.4%) and Queenstown Lakes (3.2%) continuing to defy the downward trend in quarterly growth. Queenstown is the only major urban location to record an increase in the rate of value growth compared to last month.

“Falling attendances at open homes and declining auction clearance rates have been well publicised, demonstrating a swing in the balance of power between vendors and purchasers. Developers are feeling the pinch, especially in Wellington and Auckland, with off-plan sales quotas not being met, compounding the impacts of materials and labour shortages,” Mr Nagel said.

“A big part of the three month value reductions occurred in late March and April so we expect to see a gradual escalation of value declines in the coming months as vendors wanting to sell their properties are forced to meet the market. This is a trend that’s likely to spread across all of New Zealand as listings continue to outstrip demand in the majority of New Zealand towns,” he said.

“It’s difficult to see things getting better any time soon with interest rates forecast to rise further in response to inflationary pressure, while net migration is likely to be negative for the rest of the year as the borders open up. Fortunately we have a well insulated banking sector with LVRs having been in place for much of the past cycle and with the country at almost full employment. The likelihood of wholesale mortgage defaults is low.”

Despite the latest quarterly value reductions, annual value growth continues to track positively with the average property in New Zealand increasing in value by 14% since April 2021. The Canterbury region has recorded the highest annual growth at 28.4% while the lowest growth has occurred in the Wellington region at just 7.1% growth over the past 12 months.



Home values have dropped across Auckland for the third month in a row, with the region posting an average 3.1% loss for the three months ending April 2022.

The only Auckland district that recorded positive home value growth this quarter was Rodney (1.3%). All others experienced a decline, with Papakura (-4.9%), Auckland’s central suburbs (-4.2%), and the North Shore (-3.7%) recording the largest losses.

Local QV registered valuer Hugh Robson commented: “With rising inflation and rising mortgage rates, the latest statistics indicate a 2-3% decline in sale prices. The volume of sales for April was also down, which is a significant indicator that buyers are no longer prepared to pay the high asking prices that were being achieved in 2021 and early 2022.”

“The ‘fear of missing out’ (FOMO) has diminished significantly. Vendors need to accept the market has now shifted in favour of the buyer if they want to secure a sale,” Mr Robson added.

Meanwhile, the top end of the market continues to remain relatively steady, with properties in sought after locations such as the inner city or waterfront suburbs continuing to achieve good sales results.

The average home value across the wider Auckland region is now $1,492,807 – still 14.2% higher than it was 12 months ago.


Northland’s relatively rapid rate of home value growth continues to defy convention.

Home values have grown across the region by an average of 3% over the last three months – far less than the quarterly home value growth of 8.3% that QV recorded at the end of January, but far more than the national average, which was -2.2% over the three months ending April 2022.

The average home value in the Far North District climbed 5.4% this quarter to sit right on the cusp of $800,000. Values also climbed 1.5% in Whangarei to reach a new average of $851,232, while Kaipara’s average home value also went up 3.2% this quarter to reach $948,723.


Home values declined this quarter in Tauranga, as they have in most of New Zealand’s main centres.

The city saw its home values drop by an average of 0.4% this quarter, which came on the back of a 1.4% drop in April and only minimal growth in February (0.2%) and March (0.8%). The average value of a home here is now $1,193,589, still 20.3% higher than the same time last year.

QV property consultant Derek Turnwald said Tauranga’s peaking property market was old news for increasing numbers of sellers. “There are more and more properties coming to market as owners who have held off until now realise that the market has reached its peak. Listing periods are also extending as supply increases and demand decreases,” he said.

“Demand for housing of all values has declined and is now generally subdued. It is a buyers’ market now, with agents also experiencing noticeably less interest from Auckland buyers. With the international borders opening, returning expats could pick up some of the slack, but equally we can expect to see many Kiwis head off overseas as soon as they’re able.”


Residential property growth declined by 0.9% across the wider Waikato region this quarter – a far cry from the 7% quarterly value growth we reported at the end of January.

QV registered valuer Tom Schicker commented: “There is a great deal of economic uncertainty in the market right now due to Covid-19, lending restrictions, changes to the Credit Contracts and Consumer Finance Act (CCCFA), increasing interest and inflation rates, the increasing cost of living, international supply chain issues and the war in Ukraine. These factors are having an impact on the property market, which has been slowing during the first part of 2022.

“As a result, agents are reporting a smaller number of properties selling at auction and increasing selling periods.Thames-Coromandel, Matamata Piako, South Waikato and Taupo Districts all saw small increases in median home values this quarter, while the remaining districts in the region all saw decreases.”

Meanwhile, Hamilton joins a long list of main centres with negative home value growth this month. The average value of a home ($895,523) declined by 1% in April and by 2.7% for the quarter, just a little bit more than the national average, which was a 2.2% drop this quarter.


Rotorua’s residential property values dropped by an average of 1.5% this quarter, with the average home value now sitting at $742,757.

Like the majority of NZ’s main centres, QV property consultant Derek Turnwald said local real estate agents were seeing decreasing numbers of participants at auctions and open homes, even as growing numbers of properties continued to come onto the market.

“The highly valued suburbs of Lynmore, Springfield and Matipo Heights continue to experience reasonable demand, as do properties priced between $500,000-$750,000, albeit less than late last year. But the lower end of the market typically targeted by first-home buyers and investors is very subdued right now, most likely due to a lack of confidence in the market and tighter lending criteria from the banks,” Mr Turnwald said.

“A review of the CCCFA is likely to result in an easing in lending restrictions in June, which could be good news for first-home buyers. Though there are generally very high levels of uncertainty among New Zealanders at the present time. Rising costs, rising interest rates, overseas conflict, and the ongoing Covid-19 situation have meant that confidence in the future economy and the housing market is low at present.”


Taranaki’s residential property market continues to experience positive value growth – albeit at a greatly reduced pace from the highs of last year.

The latest QV House Price Index recorded 0.3% home value growth across the wider region for the three months ending 30 April, with New Plymouth posting a small loss of 0.4% over that period.

Residential property values remain an average 19.8% higher in Taranaki than at the same time last year.

Hawke’s Bay

Both Napier and Hastings recorded negative home value growth this quarter, in keeping with the prevailing trend nationwide.

Average home values in Hastings declined by 3.4% in the three months to the end of April, with neighbouring Napier recording a much smaller 0.2% drop. The average home value in both cities is now just short of $900,000, with both now also recording the same rate of growth over the past 12 months (12.6%).

Local QV registered valuer Damien Hall commented: “The rate of growth in the Hawkes Bay property market has slowed down significantly due to a number of economic factors, including imposed lending restrictions, as well as the recent OCR and interest rate increases.”

“People’s perceptions have also changed now. There has been a significant rise in the number of listings, and properties are taking much longer to sell − though the expectations of some vendors remains high after the rapid growth we experienced last year,” Mr Hall added.

Palmerston North

Palmerston North has recorded the largest decline of New Zealand’s main centres for the second month running.

The city’s average home value ($733,791) dropped by 5.4% over the three months ending 30 April, down from the negative 3.2% rate of quarterly home value growth that was reported in the last QV House Price Index.

“The market is continuing in a correction cycle after a huge value surge in 2021. Market movement has continued in a relatively consistent negative pattern, with the local volume of sales still at a very low level,” said local QV property consultant Olivia Roberts.

“There appears to be an increasing gap between buyers and sellers that is causing many sellers to continue to reduce their asking price. With interest rates continuing to increase, the cost of borrowing is making it more difficult for buyers even with sale prices reducing.”


Wellington posted the second largest home value drop of New Zealand’s main centres this quarter.

Residential property values dropped by an average of 3.6% over the three months ending 30 April 2022, with only Palmerston North (-5.4%) topping it in the latest QV House Price Index. The largest average declines were in Upper Hutt (-8.2%) and Hutt City (-6.6%); the smallest average drop was in Wellington city (-2.3%).

Local QV senior consultant David Cornford said values continued to decline across the Wellington region, while the average number of days that it took to sell a home continued to increase. “The urgency previously seen in the market has dissipated and we are seeing significantly more offers which are conditional,” he said.

“The softer market is due to significantly more stock being available, increasing interest rates, and buyers being worried about over paying. A lot of players are sitting on the sidelines now, taking a wait and see approach, while vendors are having to be realistic if they want a deal done. In many cases, we are seeing price drops come through after a property has been sitting on the market with limited interest at the advertised level.”

“It is clear that we are now in a buyer’s market and this presents good opportunities for first home buyers looking to get into the property market,” Mr Cornford added.


The average residential property value went down this quarter in Nelson, as it has across much of the country.

Over the past three months, the average home value in Nelson has fallen 1.5% to $869,465. That price tag is still 13.6% higher than at the same time last year, but it has only increased by 2.9% in the last six months as the market has continued to slow during that time.

QV Nelson/Marlborough manager Craig Russell commented: “We’ve seen a number of price reductions in Nelson city with vendor expectations being reduced to meet the market. It’s been harder to sell properties at the lower end of the market compared with higher valued properties. This is partially due to first-home buyers and investors being hit hardest with increasing interest rates and tight credit controls.”

Mr Russell said the new build sector was experiencing considerable delays due to supply constraints, in addition to delays in obtaining title. “This may result in a number of prospective purchasers looking to buy an existing dwelling or renovating their existing homes,” he added.


Home value growth has continued to soften throughout Canterbury – though not yet to the same extent as most other regions of New Zealand.

Values were still up 1.6% across the wider region in the three months to the end of April, down from the 2.4% we reported last month, but still considerably higher than the national average of -2.2%. At 28.4%, the region’s annual rate of home value growth is more than twice the national average (14%).

Mackenzie (-1.4%) was the only district with negative value growth this quarter, with all others posting at least modest growth. But the Waimakariri District has continued to slow, posting capital gains of 1.7% this quarter, down from the 2.9% we reported last month. Selwyn followed suit with a 3.1% quarterly home value growth, down from 6.1% in last month’s QV House Price Index.

The Garden City experienced more modest growth, with home values increasing by an average of 0.9% this quarter and 0.5% in April. The city’s outer northwest and southern suburbs recorded a small amount of negative home value growth, with all other areas posting at least modest gains. The average home value is now $801,614.

“The slowed pace in growth for Christchurch is a reflection of more properties on the market with sales activity down. Prices appear to be holding despite the change in market dynamics,” said local QV property consultant Olivia Brownie.

“The further recent increase in the OCR impacting borrowing power and more stock becoming available will be key factors influencing reduced growth over the coming months.”


Residential property values have fallen 3.4% this quarter in Dunedin, with the biggest drop occurring within the first-home buyers’ segment of the market.

Local QV registered valuer Rebecca Johnston said the city’s northern and southern suburbs had posted negative value growth of 4.6% and 5.5% respectively over the last three months. “That’s what you’d expect to see in areas with a greater proportion of first-home buyer properties, with rising interest rates and tight lending criteria impacting that part of the market the most. Though amendments to the CCCFA will be positive news for first-home buyers.”

She said increasing numbers of properties were being listed with a sale price, with fewer properties being auctioned or sold ‘by negotiation’. “Whereas last year buyers were under pressure to get a property, the easing market and a greater number of listings means properties are taking longer to sell now and vendors are having to reduce their price expectations.”

As with the rest of NZ, Dunedin is experiencing a surge in townhouse developments. “Like other developments, these are also being impacted by current supply chain issues and high inflation rates due to Covid-19,” Miss Johnston added.


Queenstown Lakes District recorded the second-largest capital gains in New Zealand this quarter.

Home values increased by an average of 3.2% in the three months to the end of April – well down on the peaks of 2021, but significantly higher than the national average, which was -2.2% in the latest QV House Price Index.

At $1,649,947, the average Queenstown home value is 19.3% higher than at the same time last year. But it has increased by a relatively modest 4.9% in the last six months as the market has slowed.


The latest QV House Price Index shows a marginal reduction in value levels in Invercargill.

Home values dropped by an average of 0.6% last month, but are up 1.1% for the quarter and 13.5% for the year ending 30 April 2022. The average value of a home in New Zealand’s southernmost city is now $495,514.

Local QV registered valuer Andrew Ronald commented: “Fewer first-home buyers, difficulties in obtaining suitable finance, and rising interest rates are all contributing factors to the softening of the local real estate market – particularly in the $300,000 to $600,000 bracket.”

“The lifestyle market remains strong, possibly as a result of the preference for space and privacy following Covid forced periods of isolation,” Mr Ronald added.

Keep track of all these value movements and more via our interactive QV House Price Index.