The rate of house price growth appears to have peaked over the past three months with sales and price growth set to ease in the months ahead.

CoreLogic's quarterly property market update for for the third quarter ended September shows growth in average property values has slowed to 4.8 percent, from 8.1 per cent in April.

CoreLogic chief property economist Kelvin Davidson says sales activity and property value growth has been cooling for a few months, with stretched affordability likely to be one factor for the subdued demand, with a few would-be buyers holding back.

"It wouldn't be a surprise to see single digit gains in property values next year, perhaps around the 5 percent mark," Davidson says, noting some regions have seen a drop in average values over the past couple of months.

For example, Rotorua's values were down 2.4 per cent on three months ago, while Waikato District dropped 1.9 per cent.

Davidson says the recent increase in the Reserve Bank's official cash rate is the latest in a long list of headwinds designed to cool the property market.

"My hope is that borrowers don't get complacent about mortgage rate rises given a typical one or two-year fixed rate could be above 4 percent next year.

"Certainly, the combination of higher mortgage rates, low gross rental yields and tighter regulation, such as 40 per cent deposits and the phased removal of interest deductibility, is having a strong effect on mortgaged investors' appetite and activity."

-RNZ.