According to the latest figures released, the housing prices in New Zealand have continued to fall in the month of March as the buyers are discouraged due to restrictions on lending and rising interest rates.

The housing prices have been falling in the country since previous five straight months as the demand is affected by economic factors. The government's Quotable Value's (QV) said that the demand for housing has been affected by increasing interest rates and the limitations on bank lending in the country.

The Quotable Value's (QV) residential property index increased 8.8 per cent during the year till 31 March, 2014 compared to 9.3 percent annual rate in February. The index is now 12.6 per cent higher than market's previous high in 2007 due to indications that the housing market is slowing in the biggest city Auckland.

QV spokeswoman Andrea Rush said, "The LVR speed limits and the Reserve Bank signalling further interest rate hikes is likely to be contributing to a levelling off in the growth of property values in Auckland and for the first time in more than two years we are seeing a decrease in some areas of that market."

The Reserve Bank of New Zealand had imposed a limit on the amount banks can lend to borrowers with low deposits in an attempt to counter house price inflation.