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Auckland house values nudge towards $1m

NZN 1/06/2016 By Sarah Robson

The average price of a house in Auckland is continuing to nudge towards $1 million.

According to Quotable Value's latest figures, residential property values in Auckland rose just over 15 per cent in the year to May, with the average now close to $956,000.

Strong demand from investors is being blamed for the renewed acceleration in values in Auckland and in many other parts of the country.

"Migration is continuing at the highest levels seen in 100 years and this population growth coupled with growing demand from investors, means housing supply, particularly in Auckland and Queenstown, is not able to keep up with demand and this is driving values ever higher," QV spokeswoman Andrea Rush said.

New measures introduced by the government and the Reserve Bank to curb investor activity haven't made much of a dent in demand, and QV said if values in Auckland continue to rise at the same rate during 2016, by this time next year the average will top $1m.

Building and Housing Minister Nick Smith wouldn't be drawn on whether he thought that would become a reality.

"I'm not going to speculate on what house prices may do in the future, it's a market, ministers don't control it," he told reporters.

"What I'm going to focus my energy and effort on is those things that I know long term will make the difference for making housing more affordable for Kiwi families."

But Dr Smith conceded house prices in Auckland are continuing to rise too quickly.

"We need to get our house price increases back into single digits the single biggest thing we can do to achieve that is growing supply," he said.

The government's much talked about national policy statement on urban development will be unveiled on Thursday and it's expected to tackle issues around the supply of land for housing.

Labour's housing spokesman Phil Twyford said the new QV figures show the government's housing policies have failed to have a lasting impact.

"Whatever the government is doing, it is not working," he said.

Nationally, the average value of a New Zealand home rose just over 12 per cent in the year to May to about $578,000, which is in line with April's annual pace.

House values grew faster than 20 per cent annually in Hamilton, Tauranga and Queenstown Lakes district.

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