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QV House Price Index, February 2022: Correction looms amongst international uncertainty


All signs are pointing to a gradual correction to the residential property market as the rate of growth continues to slide.

The average home increased in value by just 2.3% nationally over the past three-month period to the end of February, down from the 6.1% quarterly growth we saw in January, with the national average value now sitting at $1,053,483. This represents an average annual increase of 22.9%, down from 26.8% annual growth last month.

In the Auckland region, the average value now sits at $1,519,781, climbing 2.5% over the last three-month period, with annual growth of 23.2%, down from the 27.6% we reported in January.

QV General Manager David Nagel commented: “Three monthly value growth for the December to February period may look quite rosy at 2.3% growth, but for the last two months there’s been no growth at all, while February actually shows a decline in values by 1%. So the strong December numbers are masking what’s really happening out there.

“There are less buyers out there now with the tightened credit rules and rising interest rates taking a number of first-home buyers and investors out of the market altogether. Increased listings from both new builds and existing homes are providing the dwindling buyer pool with ample choice and this is putting downward pressure on prices.

“It’s taking a lot longer to sell a house this year with open home attendance down and auction clearance rates significantly impacted. While part of this may be attributed to Covid-19, primarily we’re seeing a residential property market that has peaked and is searching for the new equilibrium,” he said.

All 16 of the major urban areas QV monitors have shown a reduction in the rate of three-monthly value growth from the January data. “Only Palmerston North and Dunedin have registered a decline in three-monthly growth, but if you look at just February in isolation, it’s dead even with eight urban areas showing growth and eight showing a decline. This is a pretty good sign the market has turned,” said Mr Nagel.

“The annual rate of value growth is still exceptionally high though, reflecting the very strong value increases we saw last year. So that means it will take some time for this measure to reduce to more ‘normal’ levels of growth.”

For the future, Mr Nagel said there was a lot of international uncertainty with the war in Ukraine, ongoing concerns about the impacts of Covid-19 on the economy, and what impacts this is all likely to have on inflation and interest rates. Meanwhile, there are a number of predictions of a surge of Kiwis leaving New Zealand, offsetting returning Kiwis over the coming months as the borders gradually open, further eroding housing demand. New migrants entering New Zealand are not expected to impact the housing market until much later in the year.

“We’ll likely see a continued gradual decline in the rate of home value growth with a correction in some locations that have experienced hyper-value growth throughout the past 12 months,” Mr Nagel added.



Home values dropped by an average of -1.4% across the Auckland region in February – a far cry from the 2.1% growth recorded in the same month last year, and a significant drop from the 3% growth recorded during December 2021.

Local QV registered valuer Hugh Robson commented: “The Auckland market continues to slow down, particularly in the more expensive areas such as the North Shore, some eastern suburbs, and in the inner city suburbs. Value levels are almost flat-lining now. Rising interest rates, tighter credit control, and properties staying longer on the market indicate that we will see a more stable property market throughout 2022.”

However, Mr Robson said new build developments continued to sell well, “especially if they are well located and completed to a good standard of fit-out”. “This is partly due to the recent changes in tax rules for investors, where mortgage repayment costs can only be claimed for new-build residential properties.But the next six months will be very interesting for developers, as they also face rising interest rates, tighter lending rules and major shortages in building materials.”

With the country’s borders set to re-open and many New Zealanders expected to return to these shores permanently, Mr Robson said we may soon see a mini resurgence in market activity for a time.


Northland hasn’t yet seen the same reduction in home values that many other regions recorded in February. Home values are up by an average of 1.9% overall for the month, and 6.1% for the quarter.

Kaipara District’s three-month rolling average home growth rate is 8%, down from the 11.1% we reported last month, but it puts it among the fastest growing districts in the country currently. The average home value there is now $952,4853 – still rapidly closing in on the $1m mark.

Whangarei’s home values are up by an average of 6% for the quarter – including a 2.4% increase in February – and home values in the Far North have increased by an average of 5.4% over the last three months.


The residential property market continues to cool in Tauranga, with home values rising by just 0.2% in February.

The city’s three-month rolling average is currently 4.3% – still relatively high compared to the national average (2.3%) – but likely to continue to cool as we start to move into the cooler months, according to QV property consultant Derek Turnwald.

“It is no longer a seller’s market,” he said. “There are less prospective buyers out there and a greater number of vendors. Though there’s still plenty of demand, tightening lending criteria and rising interest rates mean prospective buyers are either not able to purchase at all, or are having to scale back their purchase options.”

“International borders are being opened and we can expect a significant number of Kiwi expats to return home, putting some upward pressure on prices. However, it is just as likely that many skilled workers will migrate to Australia where wages are typically higher, houses are more affordable, and the cost of living is generally lower,” he added.


Residential property values were all but static across the Waikato region last month, with the latest QV House Price Index recording growth of just 0.1% on average.

In Hamilton, however, home values dipped for the second month in a row, declining by -0.4% in February, after also dropping by -0.1% in January. A relatively strong finish to 2021 is the only reason that the city is still showing positive home value growth for the quarter.

Local QV registered valuer Tom Schicker commented: “Due to rising interest rates and tough lending conditions, the mid-to-lower-end of the Hamilton market has become less active for a while now. Now it appears that demand for properties in the higher price bracket is also softening, with real estate agents confirming there are most definitely less eligible buyers in the market today than there were only a few months ago.”

Outside of the big city, all other Waikato territorial authorities are still showing relatively strong home value growth for the quarter – but much of that growth was modest at best during the month of February, with Otorohanga District and South Waikato District also showing small declines.

“We’re seeing the early signs that suggest the residential property market is transitioning from a seller’s market to a buyer’s one,” Mr Schicker added.


Residential property values continue to experience only minor growth in Rotorua, where the average value of a home is now $761,309 – up just 1% in February.

It’s the third month in a row that home value growth has been kept to 1% or less, with the city’s three-month average sitting at 2.5% overall.

QV property consultant Derek Turnwald said local real estate agents were seeing decreasing numbers of participants at auctions and open homes. “More properties are being listed with a sale price and fewer are being auctioned or sold ‘by negotiation’. Vendor expectations remain high and in some cases are unrealistic,” he said.

“There are more properties being listed as vendors held off making decisions when values were rising rapidly. But first-home buyers are finding it very difficult to get finance at the moment. Loan applications are being scrutinised much more than previously and therefore people are being restricted from borrowing and therefore purchasing.”

Mr Turnwald said omicron was likely to have a significant impact upon the labour force and delays in the shipping of overseas and domestic products. “Commodity prices continue to rise sharply and petrol is now expected to rise in price significantly due to the Russia-Ukraine conflict. These factors, together with rising interest rates, are likely to further dampen interest in the property market.”


Taranaki’s residential property market has finally begun to slow, with the average home value dropping across the region by -1% in February.

New Plymouth home values declined by -0.9% to a new average of $755,194, with the neighbouring districts of Stratford and South Taranaki also experiencing declines in residential property values. However, values throughout the Taranaki region remain 26.5% higher than the same time last year.

Hawke’s Bay

The latest QV House Price Index recorded all-but-static growth across the Hawke’s Bay region in February − with Hastings even posting a modest decline of -0.4%.

Home values continued to grow in neighbouring Napier, rising by 0.8% in February, but local QV registered valuer Damien Hall said the region’s residential property market was finally starting to cool after a bumper 12 months that saw values increase by an average of 25.8% across the Hawke’s Bay.

“Following on from January, the month of February has seen house prices continue to slow in the Hawke’s Bay region,” he said. “With the exception of Hastings and also Wairoa, where values have dropped by an average of -1% over the past three months, the rate of growth remains positive in most areas but at much lower rates than what we’ve experienced in the past two years.”

“Agents in Hawke’s Bay are reporting a decline in activity, especially in the lower to mid quartile range, to the point where the market has almost stalled. The recent increase in the OCR has put more doubt in the minds of first-home buyers and borrowers alike, with expected continued upward pressure from interest rates to stall things further in the coming months.”

Palmerston North

It’s official. Palmerston North’s residential property market has cooled right down.

The city’s three-month rolling average is showing a decline in average home value of -1.1%. The average home value is now $753,832 − still 18.1% higher than the same time last year.

QV property consultant Olivia Roberts commented: “The market is continuing in a correction cycle after a huge value surge throughout much of 2021. After all the government interventions last year to try to cool the market, it appears the single largest effect in halting the market has been interest rate rises.”

She said the lower price brackets had been leading this downward trend for a while now, with homes in the higher price brackets now also following suit.

“The number of listings continues to increase, adding more choice for buyers. This suggests a levelling in supply and demand may potentially be in effect as well,” Miss Roberts added.


Home values dipped by an average of -1.1% across the wider Wellington region last month, with all districts in decline.

QV’s three-month rolling average is still showing all-but-static growth at just 0.1% since the end of November 2021, but local QV senior consultant Blake Ngarimu said that number is likely to drop into negative territory as rising interest rates and tough lending conditions continue to bite.

“The February stats show the first signs of a dip in the market, with all major districts within the Wellington region experiencing a decline in values. It is now clear that we have entered a much softer property market and some vendors may need to adjust their price expectations,” Mr Ngarimu said.

“The heat in the market from 2021 has been put out by a number of drivers − including higher interest rates and tougher lending conditions, coupled with an increase in supply. Open home attendance remains low, especially at the lower end of the market, which is more heavily finance driven. There has been a significant increase in listings, giving buyers more options, but also indicating to vendors that longer agency periods may be required.”


Nelson has not yet experienced the same home value drops that many other areas of Aotearoa-New Zealand faced last month.

The average value of a home here ($895,656) increased by 1.4% in February, and 4.2% over the last three, positioning it among the fastest growing urban centres in the country. Even so, local QV senior property consultant Craig Russell said home value growth had slowed considerably since the beginning of the year, with values starting to fall in the Tasman district.

“Listing numbers continue to climb with inventory now significantly above the low point of August 2021, which was when FOMO was widespread. With the increase in supply, purchasers are no longer afraid of missing out, but instead are wary of paying too much,” he said.

“Properties are generally taking longer to sell with some even sitting on the market for an extended period. In some cases this is a result of unrealistic price expectations and vendors not prepared to meet the market.”


It appears as though the residential property market may finally be leveling off in Christchurch, where the average home value increased by just 0.7% last month.

The city's three-month rolling average remains relatively high at 4.8%, but local QV property consultant Olivia Brownie said the latest QV House Price Index is now “reaffirming the sustained slowdown in value growth” across Christchurch and the wider Canterbury region’s residential property market.

“With inflation increasing and interest rates rising, together with other restrictive measures imposed by the reserve bank, the local market is slowing,” she said. “The longer term effect of these factors on the market is yet to be fully realised, but it does suggest a period of diminished growth for the wider Christchurch region.”

Home values across the larger Canterbury region increased by 0.8% last month and 5.2% over the last three, with Timaru recording a small -0.3% drop in average home value in February. Everywhere else saw at least modest gains, but down from previous highs.

“We are beginning to see a change in the power balance between buyers and sellers, which is reflected by the increase in property listings and a decrease in the number of sales,” Miss Brownie added.


Dunedin is another major New Zealand city that saw declining home values in February.

They dropped by an average of -1.5% in Dunedin last month, and -0.3% over the last three. This represents the second-largest reduction in home values of all the main centres, after Palmerston North (see above).

National revaluation manager Tim Gibson commented: “It would be a pretty good time to be a buyer if lending wasn’t so difficult to secure these days. First-home buyers appear to be the most affected by banks tightening their lending criteria. As a result, there has been a noticeable drop off in enquiries and attendees at open homes.”

Across the wider Otago region, it is notable that only the Waitaki District recorded positive home value growth last month, with all other districts posting modest reductions in home value.


Queenstown saw a small reduction in its average home value for the second month in a row.

In February, the popular tourist town’s average home value dropped -0.3% to $1,594,516, after also seeing a small decline of -1.3% in January. The three-month rolling average is currently sitting at just 0.1% growth, but is looking likely to dip into negative growth in next month’s figures if the market’s current trajectory continues.


At $497,030, the average home value in New Zealand’s southernmost city is agonisingly short of crossing the $500,000 mark.

Invercargill has so far proven immune to the home value drops that have occurred in other major centres last month, with values increasing by an average of 1.4% last month and 4.5% over the last three. Values remain 19.5% higher on average than at the same time last year.

Local QV registered valuer Andrew Ronald commented: “The latest QV House Price Index indicates stabilising price levels in Invercargill. While there is generally strong demand for residential property, many buyers are experiencing difficulties in obtaining suitable finance. An increase in lending restrictions, interest rates, and supply is having a dampening effect on the market overall locally.”

Provincial centres, North Island

As economic headwinds continue to cool many of the main centres’ residential property markets, these North Island provincial centres have so far proven immune. Hauraki (13.3%) was one of just four districts that still recorded double-figure growth this quarter, and the only one in the North Island (see below). In second and third place were Waitomo (9.4%) and Kaipara (8.1%) respectively.

Provincial centres, South Island

Three of the four fastest-growing districts this quarter were on the South Island. They are Buller (18.3%), Hurunui (10.8%), and Ashburton (10.2%).

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