The latest Quotable Value house price index data for February shows Dunedin home values rose 15.6% year on year and 5.3% over the past three months, the quarterly percentage gain being higher than Auckland's and Queenstown's.
Nationally, the average home value is more than 50% higher than the previous high of 2007.
QV's Dunedin registered valuer Duncan Jack said the Dunedin market had continued to be buoyant. Properties were selling very quickly and competition from buyers was fierce.
''Buyers are still very active and there's good demand across all the value ranges in the Dunedin housing market, with the low-mid range still being the most active,'' Mr Jack said in a statement.
Auckland's values are now, on average, 91% higher than the previous peak of 2007, at $1.04 million.
The separate Queenstown Lakes' $1.03 million average is 51.1% higher than in 2007, while Dunedin's $359,629 average value is 25.6% higher for the same period.
Dunedin's $359,629 meant the city remained the most affordable in the country, Mr Jack said.
The listing levels remained ''relatively low'' and might have been been partially affected by the quick turnover of stock, Mr Jack said.
''It certainly appears that demand is exceeding supply in the local market,'' he said.
The historic Christmas slowdown in the market was less significant compared with previous years, he said.
Average values were continuing to increase in the low to mid ranges, while in the upper ranges, demand was still good but there had not been the same notable value increases at that end of the market, Mr Jack said.
Around other parts of the South Island, the Mackenzie district values jumped 9% over the past three months, while Central Otago was up 7.8% and Southland was up 6.9%.
Values that decreased during the past three months were in the West Coast districts of Buller, Grey and Westland, as well as in Ashburton and Waimate.
QV's national spokeswoman, Andrea Rush, said the average value nationally increased 13.5% during the past year.
Values rose by 1.1% over the past three months and the average value nationwide is $631,349.
''The nationwide average value is now 52.4% above the previous market peak of late 2007,'' she said.
Average values had dropped during the past quarter in parts of Auckland, Hamilton and Christchurch and the rate of value growth in Tauranga had also slowed, as the latest round of the Reserve Bank's loan to value ratio restrictions continued to take effect, Ms Rush said.
