Comment: Using inflation numbers to prove a point is a nonsense.
Inflation in general runs at a different speed from property prices.
Property prices got well ahead of inflation up to 2007, and in the next year or two will get well ahead again.
The two are not tied together unless you look over decades to get a true picture.
NZ property values rise above 2007 peak in September, QV says
October 9, 2012 Alex Tarrant
Property values across New Zealand rose above their previous peak in September, but are still 12% below their 2007 highs when adjusted for inflation, state-owned valuer QV says.
Nationwide values were up 1.8% over the past three months and 5.3% over the past year to rise above the previous market peak of late 2007.
“While nationwide values have been slowly increasing for over a year now, we need to put this into context. The rate of value increase is relatively slow, currently around 5% per year compared to the 10% to 15% we saw during the mid 2000s,” QV.co.nz research director Jonno Ingerson said.
“The current value increase is also being driven largely by Auckland and Canterbury. If those two areas are excluded then values across the rest of the country have only increased by around 1.5% over the past year. Furthermore, although values are now just above the 2007 peak, when adjusted for inflation they remain 12% lower,” Ingerson said.
“The number of sales in the last few months is higher than in 2010 and 2011, but the years since the global financial crisis have been characterised by very low activity. There is a lack of listings in many areas, particularly Auckland, which is also likely to be constraining sales numbers,” he said.