The winter season has sent a chill through the housing market, with slower price growth and less competition for first time home buyers.
The nationwide average rose to $672,504 but fell 0.8 percent in Auckland to just over $1 million. Photo: RNZ / Cole Eastham-Farrelly
Quotable Value's House Price Index rose 4.8 percent in the year ended August, but dropped 1.6 percent over the past three months, reflecting constrained supply and lower prices in the Auckland market.
The nationwide average rose an inflation-adjusted 3.3 percent to $672,504 but fell 0.8 percent in Auckland to just over $1 million.
QV general manager David Nagel said the combination of low interest rates and a low level of supply drove modest value growth in most other regions.
Rangitikei, Tararua, Masterton and South Taranaki topped the list in quarterly value growth, while the southern part of New Zealand, including Dunedin and Invercargill, also saw steady increases.
"Overall, we're anticipating value growth to remain flat or steadily grow across most regions.
"The market is currently experiencing polarising forces with key market drivers such as low interest rates, population growth and lack of supply, being countered by tightening credit conditions and a range of government policy initiatives aimed at cooling the market,"
He said first time home buyers were benefiting from less competition and were the main drivers of price growth in low-to-mid value areas.
Mr Nagel said affordability was also changing buyer behaviour with increasing demand for more affordable two-bedroom semi-detached properties and apartments.
"With population growth projected to continue to rise, I'd anticipate these types of properties will attract even more demand in future years, particularly in Auckland and Wellington city."