New Zealand’s property market remains strong with the national median selling price reaching $290,000, a 16 per cent increase from the September 2004 median.

The newly established Central Otago Lakes region (encompassing Queenstown and Wanaka) has become the new king with the median sell price now at $420,000. For the time being Auckland has to settle for being the second most expensive region at $379,000.

In terms of increases since September 04, a lot of the activity has been in the North Island. Taranaki has lead the field with an increase of an astonishing 42%, Northland recorded a change of 31% and Hawkes Bay saw a 27% increase. Wellington meanwhile had a more modest increase of 10%.

As already mentioned the Central Otago Lakes region has been the star for the South Island with an increase since September 04 of 20%. Nelson’s median sell price increased 5% from September 04. Nelson has been one of the most volatile areas which prices fluctuating, possibly due to the rest of the country catching up to its large increases in recent times.

As the year draws to an end it is clear that New Zealand house prices have been stronger than many predicted. The official cash rate (similar to the Bank of England interest rate and the US Fed rate) is now 7.0%, the highest since its introduction in March 1999. Historically New Zealand has had a much higher rate than the UK and US although the recent increases and concern about future increases are likely to put off some first time buyers. Most analysts suspect the rate of property price growth in 2006 to slow but the strong economic performance is likely to lead to an eventual soft landing.

Although property market statistics are a useful benchmark it must be remembered that there are numerous micro-markets. Property prices may have significantly increased in a region or city yet parts of that region or city could have experienced decreases. Oversupply and/or poor construction in some parts of the country can and has impacted on property prices and rental returns. Overseas buyers need to be especially wary of foreign mark ups in large developments. If the property is not being sold in the New Zealand then the question must be asked, why not? It could be that the prices are not sustainable or it is not the type of property that most New Zealanders would like to live in. New Zealand Property Finders aim to find a unique property for a fair price that matches your requirements.

If you would like more detailed information about any part of New Zealand please contact us at enquiries@nzpropertyfinders.com or +44 (0)20 8755 5853.