By Vera Sprothen
SYDNEY--New Zealand home prices rose by nearly 11% in October from a year earlier and sales were down 14%, data from the Real Estate Institute of New Zealand showed Monday.
REINZ said the national median home price in October was NZ$510,000, compared with NZ$460,000 a year earlier. House prices fell by 1% from NZ$515,000 in September.
The number of home sales fell by 9% to 6,727 in October compared to the previous month.
Despite a nationwide drop in sales volumes, median home prices in Auckland and three other regions rose to a record high in October. Prices for houses in Auckland rose by 5% to NZ$868,000 in October compared to the previous month.
Earlier this year, New Zealand's central bank tightened rules on mortgage lending further to take some of the heat out of the country's housing market and safeguard financial stability.
The Reserve Bank of New Zealand's new restrictions took effect nationwide, ending policy curbs specifically targeting Auckland, the country's biggest city, where there have been growing fears of a housing prices bubble led by property speculators.
Specifically, the RBNZ aims to limit further the amount that can be lent against the value of a property.
The changes appear to have made it more difficult to sell homes valued less than NZ$400,000, said REINZ.
"Our data suggests that the impact of the revised rules is having more of an effect on lower-priced sales compared to higher priced sales, with a surge in the percentage of sales over NZ$1 million and a noticeable decline in the number of sales below NZ$400,000 compared to 12 months ago," said a REINZ spokesman. "Some of this change may be reflective ofthe overall uplift in prices over the past year as the market for higher-priced properties is continuing as normal, but the market for lower priced properties is becoming more difficult for both buyers and sellers."
The days it took to sell a house, a gauge of underlying demand, deteriorated by one day in October compared to a year earlier. In October it took a median time of 32 days to sell a house in New Zealand.
-Write to Vera Sprothen at email@example.com
(END) Dow Jones Newswires
November 13, 2016 16:08 ET (21:08 GMT)
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