Average home values continued to rise in October, pushing past $900,000 in Auckland for the first time, according to government valuer Quotable Value (QV).
"Residential property values continue to show significant increases for many upper North Island centres including Auckland, Tauranga, Hamilton, Whangarei and Rotorua," QV national spokesperson Andrea Rush said.
"The Dunedin and Wellington markets are also now starting to show a definite upward tick while the Christchurch market is relatively flat in comparison," she said.
The average value of a home in Auckland hit a new all time high of $918,153 in October which was up 24.4% compared to the same month last year.
Within the Auckland region, average values ranged from $563,275 in the Franklin District on the region's southern flank, to $1,079,473 for homes within the old boundary of the former Auckland City Council.
Even in Manukau, where homes have traditionally been among the cheapest in the region, the average value has surged past the $750,000 mark to $783,791 in October, which was up 27.5% compared to a year earlier.
"Auckland values continue to rise fuelled by high net migration and record low interest rates," Rush said.
"While anecdotal evidence suggests that the market may have cooled somewhat in anticipation of regulatory measures being introduced by the Government and the Reserve Bank, there is still no sign that this is having any impact on rising values in the region," she said.
In Tauranga the average value of homes was $513,325 in October, up 13.7% compared to a year earlier, with much of the sales activity in the region driven by Auckland investors.
"We are witnessing a continuing trend in the Tauranga market of very strong demand form local and out of town buyers," QV Tauranga registered valuer David Hume said.
There were reports that 90% of the sections that had been sold in a new development in the beach side suburb of Papamoa had been purchased by out of towners, mainly Aucklanders, Hume said.
The quick flick merchants were becoming active in the region.
"We are also starting to see evidence of profit taking with a number of properties being turned over in quick succession as investors look to make quick capital gains in a very buoyant market," Hume said.
In the Wellington region the average home value was $461,571, up 2.6% compared to a year earlier, and in Christchurch the average home value was $476,207, up 2.7% compared to a year earlier.
In Dunedin the average value was $302,329, up 4.2% for the year.
Click on the link below to see the average values for all parts of the country and how much they have changed in the last 12 months, or use the interactive chart below to see longer term trends:
No chart with that title exists.
40 Comments
Yes it appears that we've got something quite special. It's like Christmas and Lotto have come early to Auckland. At the same time, the nutters are getting air in MSM. It really is all quite surreal.
In short, as the BIS economists put it, this is “a world in which debt levels are too high, productivity growth too weak and financial risks too threatening”. It’s impossible to extrapolate from all this the date the crash will happen, or the form it will take. All we know is there is a mismatch between rising credit, falling growth, trade and prices, and a febrile financial market, which, at present, keeps switchback riding as money flows from one sector, or geographic region, to another.
http://www.theguardian.com/commentisfree/2015/nov/01/financial-armagedd…
I don't think many people are saying it should crash right away, or even soon. I think they are saying that home prices are high compared with incomes. That isn't surprising as interest rates are been pushed lower. Indeed histrionically high prices can always be made to rise further by dropping rates, or easing in other ways. The obvious problem is what happens when you cant cut rates further? The less obvious problem is what happens to your productivity in an economy where low rates forestall the re-allocation of scarce capital from inefficient projects to efficient projects. High debt and low productivity sound dangerous but more notably as home prices soar we become less wealthy as our future growth potential is reduced. When you have a retirement problem, as it already stands, low growth is going to be problematic. Lastly as prices rise, yields drop. That is to say; as asset prices rise, the cost to retire rises. If average yields halve, then conversely, the cost to generate a given income doubles. Given asset prices trend up on falling rates, what happens when this reverses? If it never reverses what does it mean for long term growth?
...lets keep the punters confused ha!
Auckland house asking prices take a dive....
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=115…
@Rastus. There is a difference between asking prices and actual sold prices. Many houses have no 'asking prices' in Auckland because they go to auction. Also, Realestate.co.nz doesn't have any of the private market (whereas Trade Me does) so it's not looking at the full picture. This report by QV is what actually sold during October and will be pretty accurate. Only the REINZ report for October may be mor accurate .. however is usually very similar.
Basically, house prices continued to surge upwards again in October in Auckland. Perhaps owners who are looking to sell at auction only want to sell at the right price.. hence why auction clearance rates are down but prices are up.
This QV report is garbage. It is only for sales where the buyer took possession in October ie they may have agreed to buy in Jul/Aug/Sep. It does not reflect the true state of the Auckland market in October - ie auction sale rate under the hammer now around 30% to 35% - 20% more homes on the market in Auckland on trademe than at the end of September. So the QV report can be ignored - it simply does not reflect what is now happening in the Auckland market - there is now a truly negative buyer mood setting in. Just ask any mortgage broker, valuer or real estate agent. Where are Barfoots October results - would we not normally see those published here by now? interest.co.nz - head down to the Barfoots auction rooms tomorrow and take note of the lack of people in the room and number of passed in properties. Also note the disappearance of the Chinese buyers.
Despite asking prices dropping and number of new listings surging, inventory is at an all time low according to the Realestate.co.nz data.
However the inventory of properties available for sale on the website (the theoretical number of weeks it would take to sell all of the properties listed on the website at the average rate of sale) dropped to a new all time low 16.1 weeks. ~ http://www.interest.co.nz/property/78432/house-buyers-getting-more-choi…
Essentially people are asking for less than they were asking for before, getting more than they were getting before (less difference between asking and sale price), listing more houses for sale and selling even more houses than they were able to list (hence inventory dropping to record lows).
Point taken but you cannot include unfinished sales in the data so that does not make the QV report garbage. It is just fine for the periods it covers.
And, maybe the market is stalled a bit now, but it will push ahead. Vancouver/Sydney and many other places make auckland prices a bargain.
There is no normal settlement time frame, but 6 weeks maybe average (remember any conditional period from when the sale was agreed would be included too).
On that basis the sales included in the Oct figures would have been mostly between mid August and mid September.
That appears to be commonly reported. This will start flowing into the next months QE figures .
I think most people understand that the QE data is a little bit behind.
Regardless, Auckland prices will be 20 million for the average home in another 10 years so you'd better get in quick :)
People in other areas of the country are laughing that people would pay such amounts for shacks.You can get far better value in other parts of the country. Even if the pay isn't as high, the reduced mortgage payments ,make up for it. Sonme people have made a killing on selling their house and moving to other parts of NZ, the problem is that the whole country will pay if it crashes.
Yes, it makes sense for many people to live in the provinces now, particularly if you're working / middle class sitting on a windfall. Much of it depends on your ability to adapt and integrate into the regions. For example, attitudes in Whangarei are quite different to what they are in Auckland, which has implications on how you live and conduct your life.
Surfisup. The 'corporate' life is not what it is cracked up to be. There are a few chiefs, but mostly it is lowly paid indians (pun not intended). Much of the Auckland workforce is low paid corporate cannon fodder.
There is a view that the Auckland corporate scene attracts the less entreprenurial. It's a place for the waged.
Far better to be in self employed business, making bucks, and being out of Auckland. And there are a lot of people doing just that.
How much do you earn in a non executive corporate role?? Max $200k?? Yet you probably have to pay an additional $100k in mortgage and interest payments to live in Central Auckland...
That means in say Chch or Wellington you only need to earn maybe $80k to be in the same position!!
Of course if you move outside Auckland you can start your own business and have unlimited income potential.
If you are likely to get into an executive position you should be well on the way by mid 30s and know if you are going to make it or not. If you are 45 and earning $120k, you probably could have done better running a carpet laying business in the provinces...
Chris j. Not everybody is like us masters of the universe common taters on interest.co making megabucks. Most of the population, including in Auckland make very little. Most would regard a police or nursing wage in that 50 - 60 -80K as an unobtainable heaven. Read the census.
For most people it's not 200K or 120K questions. It's how to get and keep a 60K job. Including Aucklanders.
Yes, Corporates are dying to get into Awkland,
So much, I really cannot imagine why Douche Bag Banks are bailing out of Awkland.
Best place in the world to own a house and Douche Bag cannot read the market.
No wonder they are failing. Chicken feed.
They should have gone in boots and all.
Should have bought all coming on the Awkland Market.
Should have left none for the buyers to gear up on.
Should have geared up and gone for broke, themselves.
Would be buyers, would have been so desperate to own an Awkland edifice, they would have paid any price. Even their life's Savings.
Would have made a killing, not a loss.
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=115…
People you need to get out into the Auction rooms in Auckland.It is like watching the 1987 share market crash it is that bad.I would,t take any notice of this old information.
Seen 80 Auction in last two weeks it is undoing very very fast.The market has totally change as of 1 October the international buyers are out.Seen 4 property passed in 15mins today good Northshore properties no bids.
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