File photo. Photo: 123RF
House values have continued to fall with an oversupply of stock heading into spring.
The Quotable Value House Price Index for August indicates national prices fell 5.5 percent in the three months ended August, building on a 4.9 percent drop in the July quarter.
The national average house price was $973,848, which was just 1.1 percent up on the year earlier.
Wellington was among the hardest hit regions, with a 14.7 percent drop in values since January, while Auckland fell 10.2 percent over the same period.
QV general manager David Nagel said the downturn was gathering pace as tight credit and rising interest rates meant an oversupply of properties.
"We're starting to see some pretty significant value reductions now, especially in the main urban areas where value growth was previously so strong," he said.
"Market gains from August 2021 have largely been eroded from the falls in the first seven months of 2022."
He said the regions were not immune to the continued slump in prices.
Manawatu and Hawke's Bay had dropped by 9.2 percent since January.
"There are mixed views on the extent of further interest rate rises, as well as how these will impact house prices over the next 12 months," Nagel said.
"Some economists are suggesting we're close to the peak of mortgage interest rates, while other commentators are predicting house prices may fall a further 25 percent over the next 12 months."
Queenstown was an outlier among the main centres. The resort town's average value increased by 18.6 percent in the 12 months to the end of August 2022, including 4.3 percent this year, and 1.5 percent this quarter.