Tauranga property values have been given a slight boost on the back of national residential values which increased 8.5 per cent in the last 12 months.

Quotable Value's latest monthly property value figures show a 0.8 per cent rise from this time last year in Tauranga thanks to a slight lift of the same amount during the last three months.

Tauranga city property values are up 0.8 per cent.

National values have increased 2.9 per cent in the last three months – now up 8.3 per cent on the previous market peak of late 2007.

The average current value of a property in Tauranga is $432,174 - $16,000 below the national average of $448,929. But since the 2007 market peak change the city's values have dropped 10.2 per cent.

And the results show Auckland and Christchurch are still driving the national increase in values, with other cities seeing limited growth, says QV research director Jonno Ingerson.

'The provincial centres have tended to be more variable, although for much of the year many have been slowly increasing. In the last couple of months however values have flattened or even declined in many provincial areas,” says Jonno.

'It is not clear if that is likely to continue or was it just a temporary slowdown.”

Jonno says the newly imposed Loan to Value Ratio caps by the Reserve bank are in part put in place to slow down the rapid growth in property values.

Last month the Reserve Bank announced changes to the LVR, which sees mortgages with an LVR of more than 90 per cent still restricted to 5 per cent of new lending, while total new lending over 80 per cent LVR restricted to 12 per cent.

Applicants will need to have a deposit that is 10 per cent or more of the purchase price. The existing requirement for a 15 per cent deposit on lending above $200,000 will no longer apply.

Income caps will be $80,000 for one buyer and $120,000 for two or more buyers.

The bank has not signalled when the LVR rules will come into force but most analysts expect them to be implemented before the end of the year.

'They will definitely limit the number of first home buyers and investors who will usually require loans of more than 80 per cent of the property's value. However the rapid increase in values and Auckland in particular is also due to the lack of supply rather than just high demand from potential buyers,” says Jonno.

'So while the LVR limits may have some dampening effect on values, we should still expect them to increase for some time yet.”