ACTIVITY in New Zealand's housing market slowed at the beginning of this year following a buoyant 1994, according to property analysts. Fears over rising interest rates led many potential New Zealand purchasers to adopt a wait-and-see attitude in the first six months of 1995, states a report published by international property consultants Colliers Jardine. In the summer edition of its twice-yearly survey, Asia Pacific Property Trends, Colliers Jardine analysts say this slowdown in buying activity follows two years of heady growth in New Zealand's housing market. As many apartments in Auckland and Wellington became stuck on the market, so a number of proposed residential developments in the capital failed to proceed to construction in the first half of this year, Colliers found. This situation contrasts with rapid expansion of the market last year, when house prices surged with the Auckland property market leading the way. Median house prices rose 18 per cent in Auckland and 5.3 per cent in the capital over this period. Auckland reinforced its position as the most expensive of the two cities in which to buy a home, with median house prices there reaching NZ$177,000 (HK$899,160) by the end of last year, compared to NZ$140,000 in Wellington. In the Canterbury/Westland area, which includes Christchurch, median house prices rose 10.8 per cent to NZ$123,000 by December last year. The number of homes sold in Auckland rose by more than a third last year compared to the previous year and by a fifth in Wellington. Colliers research shows that, in Auckland, new two-bedroom luxury apartments range in value from NZ$200,000 to NZ$400,000, while three-bedroom flats cost NZ$450,000 to NZ$700,000. In Wellington, there is a tighter price band with values ranging from NZ$300,000 to NZ$400,000 for two bedrooms and NZ$400,000 to NZ$600,000 for three bedrooms. There was strong foreign interest in a number of Auckland inner-city apartments in the first half of this year, Colliers found. In particular, Hong Kong interest in New Zealand property appears to be holding despite the slowdown. For example, New Zealand estate agent Bayleys sold 17 apartments at a Christchurch development in pre-sales to Hong Kong-based buyers at an exhibition in the territory in October. The studio and one-bedroom apartments on offer at The Heritage Hotel complex were intended to appeal to both owner-occupiers and investors wanting to capitalise on the boom in demand for short-stay accommodation from tourists and conference goers to the city, Bayleys said. Colliers Jardine analysts believe there is potentially room for 50 to 60 serviced apartments to come on the market to cater for Christchurch's booming tourism trade in the 12 months to June 1996. In the conventional apartment leasing market, Colliers expects rents to rise by around four per cent in the 12 months to June 1996 for top-of-the-range properties. Rents are currently NZ$825 to NZ$1,083 for two-bedroom flats and NZ$1,000 to NZ$1,300 for three-bedroom apartments. However, in both Auckland and Wellington, Colliers forecasts stagnancy in the leasing market.