The average house price increased by 6.1 percent in value over the past three months - which, despite being a rise, could be a sign that things are starting to ease.
Although prices increased in the three months ending in January, they are still down from the 7.8 percent quarterly growth seen in December, QV says. The national average value is now sitting at $1,063,765.
This means there's been an average annual increase of 26.8 percent, down slightly from 28.4 percent annual growth last month.
Residential house prices in Auckland continue to climb, with the average value now at $1,541,168, rising 7.9 percent over the past three-month period, with annual growth of 27.6 percent, down from the 29.1 percent QV reported in December.
"We saw spectacular value growth throughout 2021, with increases we'll unlikely see again for a generation. But with interest rates on the rise, tightening credit conditions and supply pressures now easing, we'll likely see a property market return to a more sustainable level of growth," says David Nagel, QV general manager.
"We've seen house listings surge in many locations where previously there was an acute lack of stock. And with the banks tightening their lending criteria in response to the new legislation, we've noticed a real falling off in auction and open home attendance."
All 16 of the major urban areas QV monitors have shown a reduction in the rate of three-monthly value growth from the December data.
"This provides a pretty strong signal that value levels are peaking, as more vendors list their homes and the number of buyers reduces, especially first-home buyers and investors seeking bank credit," Nagel says.
"We're not seeing the double-digit quarterly value growth we were used to seeing throughout last year, with Christchurch still leading the way at 8.8 percent quarterly growth, a reflection of relatively affordable pricing of our second-largest city.
"The annual rate of value growth is still exceptionally high though, reflecting the very strong value increases we saw last year. So that means it will take some time for this measure to reduce to more normal levels of growth."
Four of QV's 16 urban areas it tracks have house values of over $1 million. These are:
- Auckland - $1,541,168
- Tauranga city - $1,197,798
- Wellington region - $1,092,965
- Queenstown Lakes District - $1,599,524.
Despite Queenstown's average value being over $1 million, it led the way for the lowest three-month growth, sitting at just 1.7 percent.
For the future, Nagel says all eyes will be on the overseas response to New Zealand's borders reopening.
"If the floodgates were to open again to new migrants and returning Kiwis at the levels last seen in 2019, then we could see some strength return to the property market as demand for housing increases," he says.
"But more likely we'll see a gradual decline in the rate of growth, as interest rates rise and tax deductibility rules take effect for investors, with only a few locations showing any significant reductions in value."