Low interest rates have fired up the housing market and should prompt more house price growth through next year than had been expected, ASB's economists say.

They have revised their house price forecasts for 2020.

Where previously they had tipped growth of 5 per cent to 6 per cent next year, they now expect 6.5 per cent nationally.

Regional New Zealand will have the strongest growth, according to the forecast, at 7.7 per cent in 2020 followed by 3.4 per cent the year after.

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Wellington is expected to have the fastest price increases of any of the main centres, at 7.6 per cent in 2020 and 5.5 per cent in 2021.

Economist Mike Jones said Auckland's market in particular had bounced back faster than expected, driven by low interest rates.

The turning point had been the end of the capital gains tax proposal in April. Investors had adjusted to the new environment and were re-entering the market, he said.

DAVID WHITE/STUFF ASB expects house price growth in Auckland of 5.5 per cent next year and 4.3 per cent in 2021.

Monthly sales had risen since, Jones said, and monthly sales in Auckland had rebounded 30 per cent. Prices in the country's biggest city had risen for seven consecutive months.

"Mortgage rates fell steadily through to around November this year, and our rule of thumb is that it takes about six months for mortgage rate changes to feed through to house prices. The effect so far has been large. Debt servicing costs have fallen back to the low levels of the prior decade, despite the average household debt burden increasing steadily over the past few years."

ASB expects house price growth in Auckland of 5.5 per cent next year and 4.3 per cent in 2021.

Jones said the fundamentals of the market were strong, with population growth high and mortgage rates likely to stay low.

There was still a shortage of housing and, in Auckland, no sign of a significant improvement of supply until the end of 2020.