According to state-owned valuer Quotable Value (QV), residential property values in New Zealand rose at the fastest pace in five months in February, driven by strong demand in Auckland.

Figures showed that national property values rose 6.4% over the past year, up from 5.7% year-on-year in January and the the fastest pace since September 2014..

In Auckland property values rose 13% over a year, up from 12%  year-on-year the previous month and the biggest annual gain in nine months. Property values in Wellington rose at a 0.9% annual pace, Christchurch city values rose 3.4%, Hamilton increased 3%, Dunedin rose 1.2% and Tauranga advanced 4.8%.

The Reserve Bank is concerned that an overheated property market could cause a house price bubble and lead to financial instability. “The seemingly insatiable demand for Auckland property has resulted in the upward trend steepening” in the latest figures, said QV spokesperson Andrea Rush. “Values in Hamilton, Tauranga, Wellington, Christchurch and Dunedin are all showing moderate increases but nothing compared to the pace of Auckland values which continue to surge ahead.”