Property values still increasing in South

Residential property values in the South are continuing to increase modestly, the latest information from government valuer Quotable Value shows.

But there are indications the pace of gains experienced in the market in the first three months of this year has slowed, as values eased in the period to the end of March.

Until two months ago, Dunedin values had been among the fastest increasing in the country.

Values had dropped slightly since but were still up 0.2% for the past three months and 2.6% for the past year, Dunedin QV valuer Tim Gibson said.

Dunedin's property values are about 5% below the market peak of late 2007 but about 5% above the market low recorded this time three years ago.

There was a similar pattern in other parts of the southern South Island. All areas except Queenstown Lakes experienced modest to moderate value growth in the past year, ranging from 6.1% in Southland to 0.7% in Central Otago and Invercargill.

Queenstown Lakes property values declined 1.1% in that period, the QV figures showed.

National property values rose 0.5% in the three months ended March 31, slowing from the 1.1% gain over the rolling three-month period through February, QV said.

Values are 3% higher than a year ago and 3% below the market peak in late 2007.

"The marginal drop in values last month follows a year of slight month-on-month increases," research director Jonno Ingerson said in a statement.

"It is too early to say if the drop in the latest month represents a change in direction for the market."

Across New Zealand, the average sale price to the end of March was $402,317.

Southern property values

* Based on sales for the three months to the end of March
** Over thepast 12 months
Source: Quotable Value.