Christchurch is the latest city hit by an ever-increasing demand for property, where growth in values has hit a 17-year high.
Auckland property values are also rising, increasing 11 percent over the year - the first annual double-digit rise for the city since April 2017.
Data released by CoreLogic on Tuesday shows property values in Christchurch grew 3.1 percent in January - the highest of New Zealand's main centres. The nationwide House Price Index (which uses rolling 3-month sales and listings data), shows property values rose 2.2 percent over the month. Auckland property values grew 1.9 percent, behind Hamilton at 2.9 percent and Wellington at 2 percent.
Confirming the average property value in Christchurch hit $556,446 in January, CoreLogic head of research Nick Goodall said a new record was set.
"In Christchurch, the monthly growth rate was 3.1 percent - the highest growth rate of the main centres and the strongest monthly rate of growth for the Garden City for at least 17 years," Goodall said.
He attributes the jump in Christchurch property values to a mixture of demand for affordable housing, cheap borrowing and property prices playing catch-up.
"The quarterly (5.8 percent) and annual (9.0 percent) rates of growth are more modest than most other cities, but after years of very little growth in the South Island's largest city, the pronounced lift is significant and shows the pace of capital gains is accelerating," Goodall added.
The average property value in Auckland was $1,164,440, up 11 percent over the year. Measured by valuations ordered through banks, demand for mortgages across Auckland and Northland was 6 percent above the end of last year.
Growth in New Zealand's largest city was consistent and showed no signs of slowing. Although property appraisals were back to pre-Christmas levels, more were needed to match current demand.
"The appeal of a large city like Auckland doesn't really get dented...the amounts people can borrow has led to demand staying relatively strong and prices have continued to grow."
Areas near Christchurch with high increases in annual property values were Waimakariri at 9.5 percent and Selwyn at 7.7 percent - both areas where residential property development has taken off. Values in Gisborne increased 29.4 percent over the year, and Whanganui increased 25.7 percent.
As confidence in property values remains high, prices are expected to keep rising in the near future. Loan-to-value restrictions are expected to be back in from March, with the possibility limit levels will be tightened further.
"At the proposed limit levels (20 percent owner-occupier, 30 percent investment) the impact to property values is likely to be limited," Goodall said.
But he doesn't rule out the impact of Government intervention - or the risk of another COVID-19 outbreak - affecting property values in the near term.
In Provincial centres, the highest rises in December were in Napier (3.7 percent, average value $684,337), Hastings (3.6 percent, average value $663,554), followed by Invercargill (3.4 percent, average value $392,354). Queenstown values rose just 0.7 percent, but the average value was highest, at $1,214,255.
Statistics New Zealand data shows 5919 Auckland homes were transferred in December, up 53 percent year-on-year.
Although the data includes sales, marriage settlements and boundary or trustee changes, it points to strong increases in demand for property, particularly towards the end of last year.
"Recent highs in home transfer numbers over the past four months might be linked to several factors, including a catch-up from COVID-19, and a rise in new home building," property statistics manager Michael Heslop said.
Nationwide, 152,532 homes were transferred last year, up 5.1 percent from 2019.