Two distinct groups of property investors are back in the Auckland market, according to the latest QV residential property index for November.
"Investors are starting to come back to the market, but they have very definite demands," said QV Valuations Glenda Whitehead.
"Some are looking to buy, upgrade and on-sell at a healthy profit - the traders - often taking advantage of continued levels of mortgagee sales. Others require a definite positive cash flow return. The latter is often achieved by creating additional revenue from properties such as converting existing garages to sleep-outs or a further self-contained unit."
Increased activity from investors and first time buyers has helped push values across the Auckland area up 3.4% on last year to their highest ever level, 0.6% above the market peak of late 2007.
Within the Auckland area the greatest increase in value has been seen in the old Auckland City, up 4.7% annually and 2.5% above the previous market peak.
Nationwide, QV reported values have continued their steady rise, up 1.7% from last year and 4% below the market peak.
"National property values have been gradually increasing since April, driven initially by Auckland and Christchurch," said QV research director JonnoIngerson.
"In the last three months values have now begun to increase across the rest of the main centres, as well as in many of the provincial and rural towns."
Ingerson said most centres had seen a post-Rugby World Cup rise in new listings, giving buyers greater choice.
"However, many remain cautious in their decision making and are not rushing to purchase. First home buyers are remaining active and are driving the lower to middle range of the market," he said.
In the capital the property market continues to show signs of positivity.
Values dropped from January to August, but since then have steadily rebounded and are just 0.4% below November 2010 and 6.9% below the previous market peak.
In Hamilton values have edged up over recent months, recovering some of the losses from earlier in the year to now sit 0.3% below last year. Tauranga values have also increased slightly in recent months to 0.4% above last year. Both cities have shown little sign of real strength in the property market and remain 11% below the market peak.
Christchurch values continue to increase due to demand for undamaged houses, particularly in the northern and western suburbs. Values are now 3.6% above last year and only 1.7% below the 2007 market peak.
The surrounding areas have also continued to increase in value with Waimakariri District up 6.9% and Selwyn up 5.3% over the past year. Both areas are now well above the previous market peak.
In Dunedin values have increased 2.4% in the past three months and are now only 0.2% below the same time last year and 6.1% below the previous peak.
"There looks to be a late spring surge in market activity which is likely to continue up until Christmas, then pick up again in earnest in February. The strength of this activity will depend to some extent on how economic events pan out in Europe," Ingerson said.
Of the provincial centresWhangarei, Gisborne and Nelson have increased in value the most over the past three months. With the exception of Wanganui which is 6.3% below last year, most other towns are either close to or only slightly below last year's value. The exception is Nelson where values are 3.2% above last year.