Average housing values are continuing to rise throughout the country but the rate of growth is slowing, according to Quotable Value (QV).
The average value of a New Zealand home is now $622,309 based on sales over the three months to the end of October.
That's up 12.7% compared to the same period last year, but that rate of growth is slowing.
The average value of a New Zealand home at the end of September was $619,660, which was up 14.3% compared to the same period of last year.
The same trend is evident in the upper North Island centres, where property values continue to rise, but at a slower pace, with the annual increase in housing values in Auckland declining from 15% in September to 13.8% in October, while in Hamilton it declined from 27.1% to 25%. In Tauranga it was down from 28.1% in September to 27% in October.
According to QV the rate at which housing values are increasing in Auckland is the slowest it has been since March last year.
New LVR restrictions take effect, Wellington unaffected
However that may not be much comfort to people struggling to get into the housing market in Auckland, where the average value of a home is now $1,045,207. and even in Franklin, the southern most part of Auckland which has the cheapest house prices, the average value is $641,668 (see the table below for average values and annual growth rates for all parts of the country).
"The QV House Price Index is now showing a slight tick to the right which reflects an easing in the annual rate of growth over the past month as the latest round of LVR restrictions begin to take effect," QV national spokesperson Andrea Rush said.
"Sales volumes are down by around 12% on the same period last year and mortgage approval rates are also down.
"Home values continue to rise faster in the Wellington region than the Auckland region and the housing market in the capital appears largely unaffected by the new LVR restrictions, particularly at the more affordable end of the market in areas such as the Hutt Valley, Porirua and the Kapiti Coast.
"Auckland, Tauranga and Hamilton home values are continuing to rise, just at a slightly slower pace than they were prior to the new LVR measures being introduced.
"The Dunedin market also continues to see good levels of activity and demand, while investors are less active in the Christchurch market and home values there continue to show only modest growth.
"The new build market remains strong as the new LVR restrictions for investors do not apply for new homes.
"Less established investors appear to having difficulty raising finance with the new 40% deposit requirement, while recent CoreLogic Buyer Classification Data shows that 34% of investors with five or more properties do not need to raise a mortgage so are not affected by the new LVR rules.
"Those investors shut out of the more expensive markets appear to be turning their sights to more affordable markets in relatively close proximity to North Island main centres," Rush said.
| Territorial authority | Average current value | 12 month change% |
| Auckland Region | 1,045,207 | 13.8% |
| Wellington Region | 558,886 | 21.1% |
| Main Urban Areas | 747,507 | 12.6% |
| Total New Zealand/Nationwide | 622,309 | 12.7% |
| Whangarei | 451,874 | 23.9% |
| Kaipara | 436,144 | 20.2% |
| Auckland - Rodney | 918,899 | 17.1% |
| Rodney - Hibiscus Coast | 896,988 | 16.4% |
| Rodney - North | 940,204 | 17.5% |
| Auckland - North Shore | 1,220,550 | 13.5% |
| North Shore - Coastal | 1,391,044 | 12.9% |
| North Shore - Onewa | 990,038 | 13.9% |
| North Shore - North Harbour | 1,179,794 | 14.4% |
| Auckland - Waitakere | 837,300 | 13.5% |
| Auckland - City | 1,209,199 | 12.0% |
| Auckland City - Central | 1,040,640 | 11.4% |
| Auckland_City - East | 1,497,097 | 11.4% |
| Auckland City - South | 1,112,901 | 13.0% |
| Auckland City - Islands | 1,032,945 | 16.5% |
| Auckland - Manukau | 906,128 | 15.6% |
| Manukau - East | 1,173,581 | 16.7% |
| Manukau - Central | 698,842 | 13.9% |
| Manukau - North West | 768,563 | 16.0% |
| Auckland - Papakura | 683,031 | 16.3% |
| Auckland - Franklin | 641,668 | 13.9% |
| Thames Coromandel | 623,536 | 15.5% |
| Hauraki | 324,565 | 24.3% |
| Waikato | 420,770 | 30.2% |
| Matamata Piako | 367,901 | 24.9% |
| Hamilton | 537,388 | 25.0% |
| Hamilton - North East | 687,161 | 26.8% |
| Hamilton - Central & North West | 500,392 | 25.3% |
| Hamilton - South East | 489,753 | 23.8% |
| Hamilton - South West | 467,546 | 23.1% |
| Waipa | 465,856 | 23.8% |
| Otorohanga | 242,854 | 17.2% |
| South Waikato | 174,620 | 23.4% |
| Waitomo | 164,567 | 11.8% |
| Taupo | 413,176 | 16.8% |
| Western BOP | 596,782 | 33.0% |
| Tauranga | 651,725 | 27.0% |
| Rotorua | 362,583 | 25.9% |
| Whakatane | 373,817 | 23.8% |
| Kawerau | 151,957 | 49.3% |
| Opotiki | 259,963 | 21.2% |
| Gisborne | 256,490 | 10.4% |
| Wairoa | 165,063 | 12.1% |
| Hastings | 366,083 | 16.3% |
| Napier | 396,000 | 18.1% |
| Central Hawkes Bay | 232,718 | 9.5% |
| New Plymouth | 402,526 | 9.9% |
| Stratford | 230,372 | 8.6% |
| South Taranaki | 201,793 | 8.1% |
| Ruapehu | 151,169 | 13.1% |
| Whanganui | 204,553 | 12.0% |
| Rangitikei | 159,097 | 10.5% |
| Manawatu | 277,404 | 11.5% |
| Palmerston North | 335,136 | 12.7% |
| Tararua | 162,470 | 10.2% |
| Horowhenua | 240,800 | 15.3% |
| Kapiti Coast | 458,013 | 18.5% |
| Porirua | 470,059 | 21.7% |
| Upper Hutt | 405,550 | 19.6% |
| Hutt | 460,572 | 22.6% |
| Wellington | 671,387 | 21.3% |
| Wellington - Central & South | 673,584 | 19.4% |
| Wellington - East | 722,209 | 22.5% |
| Wellington - North | 594,589 | 22.2% |
| Wellington - West | 785,452 | 23.2% |
| Masterton | 263,384 | 11.0% |
| Carterton | 306,842 | 17.0% |
| South Wairarapa | 344,807 | 13.2% |
| Tasman | 485,666 | 12.8% |
| Nelson | 484,019 | 13.8% |
| Marlborough | 410,484 | 14.4% |
| Kaikoura | 387,698 | 7.7% |
| Buller | 188,680 | -3.2% |
| Grey | 204,470 | -3.2% |
| Westland | 231,861 | 0.0% |
| Hurunui | 364,973 | -0.1% |
| Waimakariri | 430,173 | 3.7% |
| Christchurch | 498,425 | 4.7% |
| Christchurch - East | 376,670 | 4.3% |
| Christchurch - Hills | 680,656 | 7.1% |
| Christchurch - Central & North | 587,282 | 4.9% |
| Christchurch - Southwest | 447,107 | -1.4% |
| Christchurch - Banks Peninsula | 507,707 | 6.4% |
| Selwyn | 541,536 | 5.1% |
| Ashburton | 350,641 | 4.8% |
| Timaru | 333,399 | 6.8% |
| MacKenzie | 383,839 | 18.6% |
| Waimate | 219,464 | 5.8% |
| Waitaki | 252,402 | 9.2% |
| Central Otago | 408,830 | 21.5% |
| Queenstown Lakes | 974,564 | 29.8% |
| Dunedin | 341,566 | 13.0% |
| Dunedin - Central & North | 354,449 | 12.4% |
| Dunedin - Peninsular & Coastal | 305,445 | 11.9% |
| Dunedin - South | 326,917 | 14.3% |
| Dunedin - Taieri | 354,447 | 12.7% |
| Clutha | 183,785 | 12.9% |
| Southland | 220,621 | 5.3% |
| Gore | 199,523 | 7.8% |
| Invercargill | 229,342 | 7.2% |
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49 Comments
Yeah last quarter numbers would be nice. These are normally reported worth qv data. Shows how things are changing, auck might still be up 13% from 12 months ago but likely all that a gained in start of the year and the last 3 months may have been flat (could even have fallen for all we know without getting the 3 month data).
Just have to wait till qv update there website.
it won't happen. Auckland will always be a more desirable place to live, at least for foreigners (better weather, better beaches nearby, more hours of sun and less heating costs, better international connections, better international recognition and foreign investment..)
Double check your sunshine hrs 'fact'.
Auckland much less desirable place to live for many many ppl. Welly cbd living historically has been more expensive than auckland (less shoe box slum apartments in welly, generally making things a tad more classy) less flat land that's not reclaimed also and a more centralised cbd with highest density of working population in nz around lambton (thanks to govt)
maybe Auckland can make it onto this list of some of the great cities of the world, only need to squeeze another mil in
https://en.wikipedia.org/wiki/List_of_cities_by_population_density
AKL is barely a city on a global scale. Building capacity is constrained. I hear in the building industry there is a shortage of basic items like plasterboard so it's not just about planning consents, labour etc. It will probably take 20 years to add 1m people to the population of AKL.
Wellington is little more than an administrative town that happens to be the capital. Tauranga and Hamilton will overtake it in population terms in medium term imo.
Penguin, Wellington hardly just an administrative capital. Higher GDP growth per capita than all major centres, highest wages in nation. Home to NZ film industry. Regarding IT Auckland is looked on as the maintenance/ administrative sector, while Wgtn is the creative centre, hence have start ups out of Wellington such as Xero and Cric HQ etc.
So basically no slow down at all in auckland, back at a +20% pa rate. Wonder why this figure was so poorly reported given its the most significant figure of all. If auck keeps flung at 5% a quarter with 60% lvr limit then unfortunately we will definately see DTI coming in.
Not too sure that Core Logic is right here?
Would have doubts that a third of property investors are sitting around with several hundred thousand at least available without borrowing?
The major problem that has happened with the property and the Banks is that the Banks have lent out at 80 per cent and extended that as a loanable value on previous mortgages has now dropped it to 60 per cent on all the existing loanable values, which is a huge negative.
Hasn't affected us yet but it probably will in the future because they will all need to be revalued due to the number that we have.
Don't believe the The DTIs will be brought in as the LVR at 60 per cent is a killer to any new investor and it will kill the inspiration for someone with equity in their own home that wants one or two rentals.
Forget about it.
DTIs if brought in would kill the first home buyer totally in many cities.
If they weren't leveraging to the hilt before the change in LVR rules, what makes you think that they would feel the need to now?
If you've had a personal LVR rule of 50% for most of your life then the Reserve bank setting a 40% LVR rule make no difference at all to your investment strategy. You'd just wait till you could buy another at 50% LVR and do so.
If you're a first home buyer in Auckland with a decent deposit, what do you do?
Wait for a crash and hang onto my money, or buy in and risk having my one and only asset plummet in value?
Or will the lack of supply mean the crash doesn't happen?
Honestly no idea what to do anymore.
You wait for confirmation of the next recession in official data. Then look to buy 6-12mths from this date, and ensure you are buying from a distressed seller. If the houses are homogenous new builds, you put in offers approximately 20% below market value, until you come across the developer under financier pressure, or the property investor under pressure from their bank. If not new builds place offers 10-15% below market until get a bite. There is no guarantee you will buy cheaper than you can today, though I would say in all likelihood you will. The key is you will be tilting risk reward in your favour and will be less likely to slip into negative equity. Hope this helps, always need to have a 5-10yr plan and patience.
Recession will be confirmed by official data with 2 successive quarters of negative inflation adjusted GDP, will likely coincide with a fall off in net immigration. If National wins election Sept 2017 and immigration remains above 30K per annum, then GDP growing at less than 1% per annum, can also act as your recession trigger (National will likely try to prop up GDP with immigration). Then ideally wait 6-12mths, as lay offs/ reduced self employed income will lead to loan/ mortgage defaults and reduced spending. This will then pressure businesses and those who have defaulted will be strongly encouraged to sell or forced into mortgagee sales. This is when you pitch offers 20% below the new reduced market value. Say at peak properties worth 1 million, and during the recession similar properties selling for 850K, you offer about 680-700K (have finance pre-arranged so not conditional on finance). You will get lots of rejected offers but eventually someone will bite. Official data often only shows a 10% reduction in prices during a recession, but on the ground I would expect to buy 25-30% below previous value from developers and leveraged property investors. Even during a very mild recession, still get at least 25% discounts, key is to have pre-arranged finance and pitch as clean an offer as possible with a short settlement. In my hay day I would settle that week, offer on Monday, close Friday (arranged with lawyer), but 2-4 weeks would work.
There will be another recession there always is, at this point properties will be available at a discount. The one thing I have learnt about markets is they can do anything, bull markets push higher than you would expect and then often keep rolling for another 12-24mths. I believe this has happened in Auckland. If I was to place a bet I would say Auckland property prices will fall. The key is to concentrate buying to a recession (buyers market), as then you can get a great deal and set yourself up well for the future. If it was me I would forget about property for at least 18mths, and say to myself I will get a great deal during the next recession, and this is why I am waiting and being patient. Need to keep your deposit safe, if in banks split between a few and if Auckland on Australian property markets start to fall and it is all over media, I would put my deposit funds into NZ government bonds. As when recessions hit, safe havens are no longer safe. I placed all our funds mid-2008 in NZ govt bonds, as I was only happy to lend to someone who could print money to pay me back. The key is to leave behind the angst about property, and be patient, life is too short to be fretting over not owning a house. Enjoy having minimal debt and wait. Remember the rich get richer because they don't have to make money and are happy living their lives, so assets have to be at bargain prices to entice them to get involved . While the poor and middle class scramble around trying to make things happen, and invariably buy at the wrong time.
I am more hesitant to advise buy now than I was twelve months ago. My advice would be to be as choosy as possible and not be hasty. Seek the best location you can afford and possibly a two bedroom, low maintenance place that can easily become a three bedroom or has room for a sleepout. You will know that prices have become stagnant when you see more houses with price tags and houses under contract.
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