Nationally, house price growth slowed to 4.3% in the three months to July — down from 6.6% in the June quarter — compared with Otago and Southland’s combined 3.3%.
The average house price in the area was $619,017 in July, Queenstown Lakes being at the top on an average of $1.4 million.
Invercargill’s average was $449,584 and Dunedin’s was $677,309.
The cheapest area for houses in the region was Gore, having an average of $389,905.
Dunedin’s value rose over 0.9% in July, the same rate of growth recorded in June and May.
The city’s two biggest months this year so far were February, having a 2.6% increase, and April, a 2.5% increase.
The slowing in growth in the Dunedin market would most likely be because of less interest from investors in residential property, QV’s area manager Tim Gibson said.
That was caused by the Government’s legislation change earlier this year, he said.
"There is still demand there for homes but the rate of growth in house prices is levelling off," he said.
There had been lower than usual turnout at open homes in Dunedin in recent months which could be a sign of uncertainty in the market, Mr Gibson said.
"Buyers are probably a little hesitant and conservative about what might happen with interest rates at the moment and it is winter, so it is normal to see a slight drop in turnouts," he said.
Queenstown experienced a sharp rise in house prices in July.
After three months of little to no growth, the average house price jumped 3.5% in July.
There was a high level of demand for property and strengthening value growth in the Queenstown market, QV’s Queenstown property consultant Greg Simpson said.
He believed interest rates rising would cool the market.
In Invercargill, house prices rose 2.9% in the past three months.
That was well down from 6.8% growth in March.
All of the other regions across the country showed a reduction in the rate of growth in July compared with June, but only two, Rotorua and Marlborough, recorded falls in average values.
In Rotorua the average value declined from $691,789 in June to $684,130 in July, while the average value in Marlborough declined from $689,485 in June to $686,403 in July.
— Additional reporting The New Zealand Herald
