New Zealand annual house prices retreat further in March

Annual New Zealand house prices have plummeted further, decreasing by double-digit percentage points from this time last year.

The CoreLogic house price index decreased by 10.5 percent year on year in March, data showed on Wednesday. That followed a 9 percent retreat in February. 

Annual house price declines remained strong in the north, with double-digit downturns in Wellington (down 20 percent), Auckland (-13.1 pct) and Tauranga (-10.6 pct).

Solid price decreases were also recorded in Hamilton, down 8.4 percent in a year.

House prices also continued to decline in the south. Annual prices fell 11.1 percent in Dunedin while Christchurch - which often bucks the national market trends - was down a more modest 2.9 percent.

Monthly prices fell by 1.1 percent in March after dropping by 1 percent in February.

Prices in Dunedin alone - the weakest of the main centres - declined 2 percent for the month and 3.9 percent in the quarter.

"Among the main centres, there was a tight bunching of [monthly] falls in March, with Auckland, Tauranga, Wellington, Hamilton and Christchurch all 1-1.5% down," said CoreLogic chief property economist Kelvin Davidson.

New Zealand annual house prices retreat further in March

Property prices have been squashed by the Reserve Bank's (RBNZ) aggressive official cash rate hikes to cool skyrocketing inflation, with the central authority predicting property prices to contract by a total of 23 percent

"Interest rates for both new borrowers and existing borrowers who are repricing remain elevated and this is requiring some careful budgeting," said Davidson.

"Mortgage availability also remains restricted and neither buyers nor sellers are in much rush, meaning market activity is low. These factors make it easy to see why property values are continuing to drop."

New Zealand annual house prices retreat further in March

Interest rates were expected to continue their upward trend, with the RBNZ on Wednesday likely to carry on with increases to borrowing costs when the bank makes its latest official cash rate decision. 

"The housing market 'mood' is pretty subdued at present, with both buyers and sellers… accepting tough fundamentals and lower prices," Davidson said. "However, the first marker for this downturn coming towards its conclusion - a mortgage rates peak - now seems to have been reached."

Continued deflation in the New Zealand housing market was reinforced by a separate report by, which found only 9242 properties went up for sale in March - a 16-year low.