RBNZ sees 15% fall in house prices from their peak

The Reserve Bank of New Zealand has forecast house prices will fall 15% from their peak in late 2007, increasing the size of its forecast fall from 13% back at its June Monetary Policy Statement. The Reserve Bank said actual house prices were likely to have fallen further than that estimated by the Real Estate Institute. "After allowing for compositional factors, (eg proportionately more high value property sales), it is likely that house prices have fallen even further during the June quarter than data from the REINZ suggest," the RBNZ said. "We're expecting nominal house prices will fall 15% and we're only about half way into that," Bollard said.