New Zealand property values have risen 8.9 per cent, on an annual basis, suggesting bank lending restrictions introduced at the start of October are so far having little impact.
Property values in the Auckland area in October rose at a 14.5 per cent annual pace while Christchurch values were 11.8 per cent above last year, according to state valuer Quotable Value.
The national pace was up from 8.4 per cent annual growth in September.
"As has been the case for some time, current nationwide value increases are largely driven by Auckland and Canterbury," QV research director Jonno Ingerson said.
"Most of the rest of the main centres are also increasing but at a slower rate. In contrast, many of the provincial and rural areas have declined in value."
Rapidly accelerating house prices in the country's two biggest cities prompted the Reserve Bank to impose restrictions on high loan-to-value ratio lending. The impact of lending caps will be most felt by first home buyers, and in provincial areas, affecting volume and values although it will take some months before any evidence becomes clear, Mr Ingerson said.
The Reserve Bank has signalled interest rates are set to rise from a record low 2.5 per cent next year and further increases are likely should lending limits fail to stem rapidly rising house prices.
Population expansion in Auckland is outpacing housing supply, while Christchurch is being rebuilt following a series of earthquakes.
House values in the Wellington area rose at a 2.3 per cent annual pace while Hamilton increased 5.1 per cent and Tauranga edged up 0.7 per cent.
Values in most provincial centres have been increasing at two to three per cent over the past year, although New Plymouth outpaced other centres with 5.3 per cent annual growth and Napier declined as lending limits impact first home buyers, the agency said.
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