11 Mar 2021

House prices hit new highs with busiest February market in 14 years

10:21 am on 11 March 2021

House price growth continues unabated according to the latest numbers.

Houses around Lyttelton area in Christchurch

Photo: RNZ / Nate McKinnon

Real Estate Institute figures for February show the median price rose was up 23 percent on a year ago, to $780,000.

Reinz's house price index, which measures the changing value of property in the market, hit a fresh high, the annual gain 21.5 percent, the biggest annual rise since May 2004.

"February was certainly an extraordinary month, with a new record median price for the country and 12 regions and 37 districts all reaching new or equal records.

"Wellington, Manukau and Waitakere Cities now all have median prices of $1,000,000 or more, meaning that seven districts across the country now have reached or exceeded the million threshold," REINZ chief executive Bindi Norwell said.

The number of houses sold was up 14.6 percent and reached the highest number for the month of February in 14 years.

Norwell said the data would make for tough reading for renters and first home buyers who one day hoped to buy a property.

"Hopefully the re-introduction of the LVRs will start to slow down the rate at which prices have been rising, and that the market will stabilise in due course."

The Reserve Bank brought loan to value ratios (LVRs) back in at the start of March, over concerns about the number of heavily indebted people and the risk that would pose to the financial system in the event of a sharp correction in the housing market.