The pace of house price growth picked up in July, driven mainly by strong growth in the Auckland and Christchurch markets.
According to the Real Estate Institute of New Zealand's House Price Index (HPI), overall prices throughout the country increased by 2.4% in July to give an annual growth rate of 30.6%.
The biggest driver of that growth was the Auckland region which recorded 3.3% price growth in July, helped by 4.7% growth in Christchurch.
Within the Auckland region, price growth for July ranged from 2.0% in Rodney to 6.0% in Papakura.
On an annual basis, price growth in the 12 months to July ranged from 17.7% in Queenstown-Lakes to 60.1% in Palmerston North.
However the latest results also reveal that recent price growth has been softer in Wellington, Hawke's Bay and Nelson.
According to the HPI, prices declined by 0.1% in Wellington City in July and were also down by 0.2% in Lower Hutt, while Nelson had the biggest monthly decline of 0.3%.
The HPI was unchanged for Napier and although it increased by 0.9% for the month in Hastings, that was still below where it was three months ago.
Overall, the latest HPI figures suggest price growth remains strong in most regions but appears to have flattened out in a handful of places.
See the table below for the full regional HPI figures.
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REINZ House Price Index - July 2021
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36 Comments
Still wait and Watch with no sense of urgency from Orr that he showed last year and opted for Least Regret policy...
This reflect the mindest of Mr Orr and his role in supporting and promoting housing ponzi. Which will be again established by his action or it should be inaction on Wednesday.
What was that news on Wednnesday / Thursday that house market is cooling and today.........this game will continue to manipulate support for housing ponzi.
Richard
You keep hoping but those buying are seemingly prepared to put up their money that prices are not going significantly south in the near future whatever RBNZ action is. These levels (with maybe some minor correction) could be fairly much the norm for a few years to come.
Mr Orr is persistent with his action or inaction so.....Also everyday news is persistent with data suggesting how inaction by Orr is killing the dream and aspiration of many, as only thing persistent is housing ponzi, comments have to be persistent.
Another news / data below forces to raise question that way back in April / May Mr Orr lied that he has data to suggest that housing market is cooling and still four to five months and still rising .....so has to comment as even data / news are repetative just like action by Mr Orr in support of ponzi.
https://mobile.twitter.com/bernardchickey2/status/1425899199531421702
Richard
With current prices levels, RBNZ have tools to slow the market but unfortunately I don’t think that these will be a magic wand to address FHB affordability issues.
Increases in OCR may slow the market but likely mean that housing affords becomes mortgage affordability.
As to DTI whether that is targeted for different groups this is likely to count against FHB.
Although the Government’s March announcements and formalising LVRs (banks had self-imposed ones) were intended to cool the market, evidence suggests that while investors and FHB have pulled back a little this has not been at significant very levels. The indications are that investors are not selling in large numbers, and levels of FHB are still at high levels since RBNZ first started publishing data in 2014.
At the moment it seems that the market has an momentum that is going to take time to correct. Part of that will need to be increased supply and consistent low immigration.
At the moment, currently with a winter market it would seem that a flattish market with possibly of some minor correction is likely the best short to medium term outlook. The market (buyers) seem to be a very strong driver.
As for RBNZ, they may take actions to cool the market but I don’t see those advantaging FHB as you seem to wish.
"With current prices levels, RBNZ have tools to slow the market but unfortunately I don’t think that these will be a magic wand to address FHB affordability issues."
One has to act to try and if it is a run away train has to act with same speed as RBNZ showed to support. Intent is missing.
Talking about silver bullet : INTEREST ONLY LOAN may not be silver but is closest to silver bullet, not very hard to restrict, if has will but again intent is missing.
The moment, it was realised that so called housing measures are not having any impact, Why did rbnz went with WAIT AND WATCH instead of trying to control. Watch even on Wednesday it will more be lip service as RBNZ under pressure to act.
FHB - those who are able to buy are borrowing in extreme under FOMO which may lead to disaster even if slight change in situation So DTI is must and if by DTI few FHB may miss out will be a disappointment but better than buying and than facing hardship.
Agree no advantage to FHB as when you comment no advantage to FHB are accepting that FHB are been screwed by both government and RBNZ, need say more.
To control housing crisis, if they want to, nothing will help unless FOMO is controlled and for that even if house price falls by 5% will help in controlling FOMO and will not make much difference after 50% growth in a year. To control FOMO it is must that it should seem that Jacinda and Orr are serious not
Instead of assurance coming from Orr and Jacinda that come what may as long the queen is in power, will not allow house price growth to stop.
Action and intent is important, rest will take care of its own.
Agree, it is important that people in power takes action to control the ponzi. If it does not have the desired result, is fine as long as they genuinely try to control, which is missing.
If a person is very sick and not responding to medicine and treatment is acceptable as long as efforts were and are been made to treat.
What is worse is that though they do not want to treat but come out with crocodile tear of concern which is rubbing salt to wound.
This Wednesday Orr will come out again to repeat himself.
I don't think any upward movement in OCR will help in your TD. The 4% rule is broken. You may need to look somewhere else to sort the retirement.
The government announced they will begin easing our borders in October. Every man and their dog wants to relocate to NZ. Expect house prices to rise significantly in summer.
General HubHub.
Meanwhile Amazon and the Hobbits have left the island.
Which makes property trading our entire 'economy'.
Yawn. Worse than primetime radio, same track thrashed to death day in, day out.
Never knew I would thank Labour so much for their incompetence in all of this. Their announcements about announcements have only increased FOMO both for housing and toilet paper.
Enjoy your ride team house owners and investors - this summer's going to be awesome while Orr and co have their meetings, chats and deliberations. Prices will rise another 10% in Auckland this summer, then stabilise (flatten, at worst) from autumn 2022.
FOMO is so high that colleague who just got residency under FOMO went and bought a one bedroom unit for $850000 and is very average. This government and Orr are promoting FOMO as a result nothing can solve this issue....remember people fighting over tissue paper under FOMO.
Unless the OCR goes to 1% next week then another 10% gain in house prices over summer is a given. Guaranteed returns, no wonder everyone who can be, is in boots and all.
Wellington probably looks less economically appealing now there are hefty council tax rises coming for decades of deferred maintenance on infrastructure. Also it just looks a bit grubby and scruffy in parts, in need of some beautification.
60% annual increase for Palmy. That must surely be a record for any city? Well since the gold rush days of the 1800s.
Yeah for investor is bonanza. On a million dollar house with investment of $400000 (40% LVR) getting $6000000 return in a year is 150% and if managed to get when LVR restriction was removed by rbnz and paid $200000 (20%LVR) return will be 300% in a year.
Why would anyone invest in any other business, when one can get such massive returns by flipping a house and this activity has the backing of Prime Minister of the county and Governor of rbnz and this return is flipped, once what if they do multiple time with the way house prices are rising on daily basis.
Both are destroying NZ economy. Where will all this lead will only know in future but by that time preparator of the crime would have retired or sitting in high position like UN or ambassador and enjoying the luxuries accumulated leaving average citizen to the path of poverty and frustration.
Something has to give way either people in power change or people make them change and history is witness when people reacts and force change is not peaceful.
Please have some consideration and use a comma or k when delineating such figures with so many 000’s.
I think that figure is an error.
If it is its an ongoing one, last months HPI report it was 61.2%, the month before that it was 62.7%.
Yes, you are correct. Crazy price growth in palmy.
No better hedge against inflation like real estate.
Nothing like a roof over your head for a good nights sleep
Please don't tell this to Jacinda Arden otherwise will put 10 people in a room and will pat herself for providing roof of the head
Well, the housing market is well-and-truly financialized.
Those with equity in property have access to Bank Funding [newly printed money].
Those with jobs DO NOT have access to Bank Funding [newly printed money].
Yet those with jobs and/or access to government subsidies are the ones paying the investor's mortgage(s)/interest-payments.
The RBNZ is not only diluting the purchasing power of the NZD by increasing the money supply, they're restricting access to the newly-printed-money to investors [landed gentry].
Though this is an over simplification of the situation and money creation, it's pretty much true on both fronts.
Maybe restrict investors (in existing properties) to ONLY borrowing money already in existence. Stop letting the RBNZ print BAND NEW MONEY and handing it directly to speculators.
If they want not very hard to control speculative demand but do they ?
Cheers to Jacinda & Orr for doing which was not seen in past. Total failure of policy and taking U turn on every promise.
This will continue in 2022 also, as rightly said once "sustained moderation" is what the target of Labour is, it doesn't said sustained moderation means 60 to 80% rise. Shame is the only word which comes to mind but it will not change todays condition.
Still growth is on the cards, lets see how far they can damage the society, making poor more poorer & rich more richer. Now it feels like working whole day doesn't mean anything in this country it's all about property.
PATHETIC SHOW...
Ohhh hey where are the comments about how dumb I am buying palmy houses for 200k 5 years ago ??!!
Matt Gilligan bet me a bottle that palmy wouldn't bet Auckland price gains.
I think TTP was on about PN a year ago.
Up 60% . . . those that got in will be happy, not so good for those who at the time thought otherwise.
May have beaten Auckland in percentage terms but will not have beaten Auckland in actual dollar terms. Auckland's house prices have gone up over 200K which is more than what you paid for the Palmy place in the last year. It was more about your total dollars "Invested" in the housing market, looking back I could have made another $100K just by buying a bigger house. Just thankful I bought something rather than nothing a year ago now.
Sorry Carlos..Bitcoin trumps property - Dec 15 tick tock
Auckland has plenty of upside over the next 3 years before it flattens off.
Shame the numbers never look at the smaller towns just outside of Auckland where Auckland spill over is pushing up property prices at an even more extreme pace.
In the Waikato especially you see places like Te Kauwhata bursting with 60-70% price rises for the last year, but it is hidden by other towns like Huntly where values are flat and even falling in some sales.
Probably a sign of the 2 speed economy really, some of us are doing extremely well and people in the lower socio-economic areas are really getting pinched with inflation and job losses.
Yep people being pushed out of Auckland on pricing alone. Some of the small towns in NZ are really horrible though, honestly you cannot drive through them quick enough with your doors locked, let alone wanting to live there.
If house prices do end up dropping, are people going to hold the government to account for saying that they only want house price growth to slow? I don't think they have ever promised that house prices would never drop, and that the housing market was a ratchet, and house prices can only ever go up and never dow. Once we have a change in government after the next election, whether it be a Greens / Labour coalition, then IMO nothing is off the table. Many people, including home owners are just so annoyed about what is happening, and the inaction. Maybe houses are being built, but many of these are rental, and do young people really want to be lifetime renters? If that this the way the government wants to head, then they need to allow people to get rentals for as long as they want to live in it for. So laws around renting need to change, and rentals all need to meet the minimum building codes. Renting is less environmentally friendly than buying IMO, as more carbon is needed with all the moving renters need to do.
Christchurch is just getting started...
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