As property values continued to fall nationwide last month, Otago figures really took a tumble, according to the latest valuation statistics.
QV valuation figures, released at the weekend, show in the three months to September 2008, Otago residential property value declined by 8.5% compared with the corresponding period last year.
Nationally, residential values fell by 5.8% in the same period.
Property value declined by 13.2% in southern Dunedin suburbs and 11.2% on the Otago Peninsula.
The Taieri and Central and Northern Dunedin fared slightly better, but property in these areas still dropped by 7.9% and 6.2% respectively.
QV Otago Southland area manager David Paterson said while there had been "some levelling-off" in Otago markets in recent months, he was not confident these trends would continue, as major banks tightened lending policies.
"This will take many first home buyers and investors out of the market and will impact adversely on demand, putting further downward pressure on prices.
"In the 1980s and '90s, we saw periods of rapid growth, followed by decline, followed by no growth. We'd expect a longer static period will continue well into next year."
Although sales values were down as the international financial crisis impacted on the New Zealand housing market, agents were reporting an increased sales volume for September.
"Rather than being an indication that the market is picking up, we can expect further price reductions as the supply of houses for sale increases and demand decreases in the months ahead."
Indications last month that a more optimistic mood had come over the market have since evaporated, QV operations manager Mark Dow, of Christchurch, said.
"We are moving into an economic recession and there is plenty of speculation things will get worse before they get better. Uncertainty over the impact of the global credit crisis, the usual lack of activity before an election, and significant tightening of lending policies by the banks is contributing to pessimism in the property market and there is little expectation of any spring resurgence," Mr Dow said.
The average Dunedin Sep-tember sale price was $271,971, compared with a national average of $379,854, (down from $391,487 in August).
Residential property values declined by:
Queenstown-Lakes district 5.3%, Invercargill 1.6%, Christchurch 7.1%, Nelson 4%.
North Island: Auckland 7%, Hamilton 8.8%, Tauranga 7.6%, Wellington 5.4%, Whangarei 6.6%, Rotorua 6.4%, Napier 4.4%, Hastings 7%, New Plymouth 7.%, Wanganui 5.5%, Palmerston North 9.4%, Gisborne 10.1%.
