The QV House Price Index for July, released on Tuesday, shows the national average house price at $NZ989,790 ($A893,120), down from a high of $1.064 million ($A960,000) in January.

It is the first time the average price has dipped back into six figures since September.

Like Australia, many New Zealand asset prices soared following government and central bank responses to the COVID-19 pandemic and lockdowns.

The official cash rate has risen from 0.25 per cent in September to sit at 2.5 per cent, with further hikes signalled from the Reserve Bank.

QV spokesman Paul McCorry said interest rate rises, an oversupply of listings and credit constraints limiting buyers all played a part in the recent downturn.

"We've seen four successive 50 basis point increases since February and little sign of an arrest in the rate of inflation. Any further increases will only fan the flames of this correction further," Mr McCorry said.

ANZ New Zealand has revised its predictions for the cash rate, which it believes will peak at 4.0 per cent.

It has also downgrading hopes for the housing market, forecasting a "peak to trough" decline of 15 per cent.

Averaged across the country, QV has measured a 4.9 per cent decrease in values in the three months to the end of July.

Auckland homes have fallen 5.5 per cent, with local valuer Hugh Robson declaring "FOMO (fear of missing out) is long gone".

"The market has turned in favour of buyers," he said.

"Buyers are being more cautious, doing more research, checking things out and comparing properties to each other."

Of the 16 surveyed regions, Wellington has fallen hardest, dropping 8.9 per cent, with Christchurch dipping back 3.4 per cent.

Just one region experienced a small uptick: the Queenstown-Lakes District, up 0.2 per cent.

Australian Associated Press