New Zealand home values split sharply between North and South Islands

Homeowners in New Zealand faced divergent financial outcomes in the three months ending in October, as property values on the two islands moved in opposite directions. Data firm QV reported that the national average home value decreased by 0.9 percent to reach $890,508. This represents a slower rate of decline compared to the 1.5 percent drop recorded in the previous three-month period ending in September.

The national figure masks a distinct geographic divide. Every major urban area on the North Island saw a reduction in home values during the quarter. The magnitude of these decreases varied by location. Auckland recorded a 1.6 percent fall, while Rotorua experienced a sharper 2.9 percent decline.

South Island markets generally maintained stability or increased in value. Only Nelson and Timaru registered small drops. In contrast, Christchurch values rose by 0.6 percent. Queenstown posted the most notable gain among the listed cities, climbing 2.6 percent in the quarter.

Simon Petersen, a spokesperson for QV, stated that the housing market is moving backward at a slower pace but not uniformly. He noted that the national average is currently 2.2 percent lower than it was at the start of the year. Petersen explained that while much of the North Island remains in a holding pattern with ample buyer choice, parts of the South Island are seeing steady growth.

Petersen described housing markets as local entities that naturally do not move in unison. He observed that while a sharp turnaround would be required for national average values to exceed their starting point for the year, home values in most South Island markets are already pulling ahead of their early-year levels.

The data suggests that the economic strength of the South Island has translated into stronger property performance compared to the North Island. The divergence between the two regions has become more pronounced in the latest update from QV.