New Zealand House Prices Rose for a Fifth Month, Led by Cities
New Zealand house prices rose for a fifth month in September, led by the nation’s largest cities, adding to signs a property recovery is helping the economy emerge from a recession.
Prices increased 0.6 percent from August and have gained 2.7 percent from a low in April, Quotable Value New Zealand Ltd., the government valuation agency, said in an e-mailed report. From a year ago, prices fell 1.1 percent, the smallest annual decline since June 2008.
Record-low interest rates together with increased housing demand and immigration are helping New Zealand recover from its worst recession in three decades. Gross domestic product increased 0.1 percent in the three months to June, the first expansion in six quarters.
“There are signs of more activity in the market,” Glenda Whitehead, valuation manager at Wellington-based Quotable Value, said in the report. “There is strong competition among keen buyers in some localities.”
In the nation’s 16 largest cities, prices rose 0.4 percent from a year earlier, Quotable Value said.
In Auckland, home to about a quarter of New Zealand’s 4.3 million residents, prices climbed 0.6 percent and in the capital city Wellington they increased 1 no faxing payday loan.1 percent.
Reserve Bank Governor Alan Bollard last month kept the benchmark interest rate at a record-low 2.5 percent and said he doesn’t plan to raise borrowing costs until late 2010. Also buoying housing demand, net immigration rose to a four-year high as more residents opted to stay at home rather than seek jobs overseas.
Consumer Confidence
House prices slumped last year amid a credit crisis and a plunge in consumer confidence. Prices in April were 9.2 percent lower than a year earlier. Confidence recovered to a four-year high in the third quarter, according to a report from Westpac Banking Corp. published on Sept. 24.
A shortage of houses being offered for sale has helped fan prices, said Whitehead.
“There is still a feeling that activity levels are below normal, with somewhat fewer listing to date than was expected,” she said.
Quotable Value said a survey of households showed a majority of consumers now expect house prices to rise over the next year, and more people are considering selling their homes within the next six months.