Hamilton house values have risen 25.3 per cent in a year

Hamilton's housing values continue to soar as investors slug it out with first home buyers in the property market.

Quotable Value released the monthly house price index on Wednesday which illustrated the rapidly growing Hamilton housing market.

The figures for April 2016 show the average value of a house in the Waikato city is now $471,072. 

It is an increase of 25.3 per cent in the year-on-year statistics from April 2015.

The north-east of Hamilton, closest to Auckland, has the highest average for house prices in the city at $596,333.

The south-west garnered the lowest average house value at $418,477, however it had the highest year on percentage increase at 27.1 per cent.

Still it is less than the nationwide average value of $568,058, which is bolstered by Auckland's average - $942,760.

Due to the huge growth in the past six month, houses have been selling in Hamilton between $50,000 and $100,000 above council valuation, QV homevalue Hamilton valuer Stephen Hare said.

"The most-sought after properties in Hamilton remain at the entry level end of the market in the $400,000 to $500,000 price bracket," Hare said.

Those properties are being competed for by investors from Auckland and Hamilton, first home buyers and others all vying for the same properties, which is driving up the prices in that category, he said.

As a result the smaller towns within commuting distance of Hamilton are also seeing the prices rise as first home owners look for houses they can afford, Hare said.

He pointed to Matamata, Te Awamutu and Morrinsville prices all increasing as Hamiltonians shift to these areas.

Hare highlighted Morrinsville as a place where the lack of supply constraints made it easier for first time buyers, and Matamata was seeing a pick up in investors who were able to get a higher yield there than in Hamilton.

However, Waitomo's average value fell 1.3 per cent.

It was one of only three areas in New Zealand to see a decrease in house value, alongside Buller and the Grey District.

Hamilton's neighbour - Tauranga, also had blooming house prices as a result of the super city's expensive property market.

The average value for a house was $577,494, a 21.2 per cent year-on-year rise, which local registered valuer David Hume put down to Aucklanders moving into and investing in the area.

He did not expect the boom to quell any time soon.

As a whole, New Zealand house values rose 12 per cent during the year. 

QV's national spokesperson Andrea Rush attributed that to low interest rates providing confidence in the housing sector and investor interest.

Rush predicted growth in the regions as people looked for higher yields than could be made outside of the main centres and or more affordable properties.

From Stuff.co.nz