Residential property values in Tauranga City are continuing to accelerate - up 8.6 per cent over the past three months and 21.8 per cent year on year.

Values in Tauranga are now 15.7 per cent higher than the previous peak of 2007.

House prices have risen 8.6 per cent in the last three months.

The average value in the city is now $557,313. Western Bay of Plenty home values are also continuing to rise, up 5.9 per cent over the past three months and 12 per cent since January 2015.

Values are now 5.4 per cent higher than the previous peak of 2007 and the average value in the district is now $450,068.

'Early indicators for the 2016 year are that the Tauranga market is continuing on from its strong year in 2015,” says QV homevalue Tauranga registered valuer David Hume.

'Properties with subdivision potential or those that have been recently refurbished continue to be in strong demand.

'There are a number of frustrated home buyers out there as demand is outstripping supply and this situation was highlighted by people camping outside ‘The Coast' sales office last weekend to secure a section in their latest release.”

David says rents continue to increase throughout the region fuelled by strong migration to the area and investors looking for a better yield as values increase.

'QVhomevalue has also seen a noticeable increase in people wanting market valuation reports done for the bank so they can refinance and utilise recent equity gains in their properties.”

The latest monthly QV House Price Index shows that nationwide residential property values for January have decreased by 0.3 per cent over the past month, which is the result of a 0.5 per cent decrease in the Auckland region in the month since December 2015.

However, nationwide values have risen 12.6 per cent over the past year and 0.7 per cent over the past three months.

They are now 34.2 per cent above the previous market peak of late 2007. The average value nationwide is now $556,206.

When adjusted for inflation the nationwide annual increase drops slightly to 12.5 per cent and values are now 14.7 per cent above the 2007 peak.