New statistics released in the latest monthly QV House Price Index shows the effect loan-to-value ratio (LVR) restrictions are having on the property market.
While nationwide residential property values for December increased 12.5 percent over the past year, Auckland prices increased at the slowest rate since January 2015 - and some parts of New Zealand saw price decreases.
"December saw a continuation of the trend of a slowing rate of value growth, activity and demand. This trend has been seen in many of the main centres since the introduction of the LVRs, which require a minimum 40 percent deposit for investment properties," says QV national spokesperson Andrea Rush.
"This coupled with the annual Christmas holiday period slow-down has led to a decrease in values in some parts of Auckland, Hamilton and Christchurch since November."
Ms Rush says this is good news for first-home buyers.
"It's actually becoming easier for them to purchase because they're not competing with investors for those entry-level properties."
However the property investors are now targeting areas where LVR restrictions are lower and the 40 percent deposit requirement has less impact on purchasing ability.
"Wellington values continue to rise faster than in Auckland but at a slightly slower rate than prior to the LVRs being introduced," Ms Rush says.
"While in Dunedin there has so far been no evident slowing in the housing market because of the new LVRs and value levels continue to increase and sales activity has remained strong throughout the Christmas period.
"This is likely to be due to the fact the Dunedin housing market offers a much lower entry level and price point than the other main centres. Thus it's easier for investors to find a 40 percent deposit to purchase there and investors have remained active there."