Average residential property values are declining or flat in Auckland and Hamilton but rising strongly in Wellington, according to the latest figures from Quotable Value.
The average value of all homes in the whole of New Zealand was $631,432 in the three months to the end of March, up 0.6% compared to the previous three months.
But there were substantial variations around the country, with values in some areas declining or flattening out and rising in others.
Auckland: Messy with values down in some places, up in others. Average dwelling value $1,045,362, -0.2% in the last three months.
Within the Auckland region average values were down compared to three months ago on the North Shore (-1.4%), Manukau (-0.5%), and Waitakere (-1.4%), but up in Rodney (+1.2%), Central Auckland suburbs (+0.9%), Papakura (+1.2%) and Franklin (+1.1%).
Sales were down overall in Auckland and upmarket properties were selling better than those in less expensive areas, according to QV homevalue manager James Steele.
"The top end of the market where cash buyers are not affected by LVRs [Reserve Bank loan-to-value ratio restrictions] continues to see strong value growth... than those in cheaper parts of Auckland such as the city's southern and western outskirts," he said.
"Areas with lower value investor stock such as Manurewa and Papakura in the south, Hillcrest and Sunnynook on the North Shore and Ranui and Glen Eden in the west, areas previously dominated by investor demand, have seen values drop back."
However that was not making life any easier for first home buyers.
"While first home buyers face less competition for entry level homes, prices are still too high for most and there are reports of some deals falling over at the finance stage, with some having trouble securing finance due to stricter criteria from banks," Steel said.
Hamilton: Values have plateaued. Average dwelling value $532,888, -0.4% in the last three months.
"While the Hamilton market is not as frantic as it was this time last year and values have plateaued, there is still good demand for properties," QV homevalue Hamilton manager Stephen Hare said.
"Auctions have become less attractive with recent results seeing more properties being passed in.
"Selling with a listing price and by negotiation has become more commonplace with vendors less inclined to auction their homes in the current market.
"With the Hamilton City market seeing values plateau, we are now seeing a levelling out in value growth in surrounding small townships such as Ngaruawahia, Huntly and Te Awamutu."
Tauranga: Still rising but not as quickly as last year. Average dwelling value $676,381, +0.6% in the last three months.
"The Tauranga market continues to rise but at a much lower rate than prior to the LVR restrictions introduced late last year," Tauranga registered valuer David Hume said.
"There have been large value increases in the $1 million-plus bracket of the market as local and out of town cash buyers not affected by LVRs continue to move or invest in Tauranga.
"At the low end and mid-range of the market things are less frantic and rather than seeing 10 way multi-offers after the first open home, we are instead seeing the market return to a more normal situation."
Wellington Region: Values rising strongly. Average dwelling value $595,501. +3.7% in the last three months.
"Values have continued to increase in Wellington on the back of strong buyer demand," QV registered valuer David Cornford said.
Upper Hutt has seen the largest year-on-year value growth, followed closely by Lower Hutt and Porirua.
"First home buyers continue to look to these regions as they struggle to secure a home in Wellington City, where average values are now over $700,000, Cornford said."
Christchurch: Patchy, with less demand for mid-priced homes. Average dwelling value $497,120, +0.6% in the last three months.
"The market is a little patchy in terms of buyer demand and sales prices," QV registered valuer Daryl Taggart said.
"There have been more listings coming onto the market which is often the most popular time to sell. However given that demand has been lower since the latest round of LVR restrictions, this is meaning buyers have more choice.
"There is still very good demand for housing at the entry level of the market, with strong competition amongst first home buyers for properties priced under $450,000.
"However, in the next level up with home prices over $600,000, we are not seeing as much demand as it's out of reach for most first home buyers and those movers looking to trade up are a lot more fussy."
Dunedin: Values still rising, but off a low base. Average dwelling value $363,821, +2.7% in the last three months.
'Listing levels continue to be at low levels, meaning its slim pickings for buyers," QV Dunedin registered valuer Duncan Jack said.
"Home value levels continue to increase with reports of strongest demand being within the mid-price range of $300,000 to $400,000."
The chart below shows the average values for March in all districts, and their movement over three and 12 months:
QV House Price Index. Three months to March 2017 |
|||
| Territorial authority | Average current value $ | 12 month change % | 3 month change % |
| Auckland Region | 1,045,362 | 12.3% | -0.2% |
| Wellington Region | 595,501 | 21.2% | 3.7% |
| Main Urban Areas | 748,957 | 12.3% | -0.3% |
| Total New Zealand | 631,432 | 12.9% | 0.6% |
| Far North | 397,600 | 18.2% | 5.5% |
| Whangarei | 472,081 | 19.3% | 3.1% |
| Kaipara | 471,203 | 20.6% | 0.8% |
| Auckland - Rodney | 940,701 | 13.3% | 1.2% |
| Rodney - Hibiscus Coast | 920,149 | 13.3% | 1.8% |
| Rodney - North | 964,038 | 13.4% | 0.7% |
| Auckland - North Shore | 1,201,367 | 11.5% | -1.4% |
| North Shore - Coastal | 1,375,264 | 12.6% | -1.5% |
| North Shore - Onewa | 952,902 | 9.9% | -2.3% |
| North Shore - North Harbour | 1,184,914 | 11.1% | 0.0% |
| Auckland - Waitakere | 828,959 | 12.1% | -1.4% |
| Auckland - City | 1,229,715 | 12.5% | 0.9% |
| Auckland City - Central | 1,062,943 | 10.8% | 0.1% |
| Auckland City - East | 1,542,858 | 13.3% | 1.5% |
| Auckland City - South | 1,108,497 | 12.2% | 0.3% |
| Auckland City - Islands | 1,066,785 | 17.8% | 4.4% |
| Auckland - Manukau | 900,324 | 12.6% | -0.5% |
| Manukau - East | 1,165,890 | 13.8% | 0.4% |
| Manukau - Central | 681,232 | 9.3% | -1.0% |
| Manukau - North West | 775,666 | 13.3% | -0.8% |
| Auckland - Papakura | 689,859 | 12.6% | 1.2% |
| Auckland - Franklin | 667,209 | 13.1% | 1.1% |
| Thames Coromandel | 670,508 | 18.5% | 5.3% |
| Hauraki | 364,116 | 27.3% | 3.1% |
| Waikato | 451,956 | 22.7% | 5.3% |
| Matamata Piako | 412,431 | 26.1% | 5.5% |
| Hamilton | 532,888 | 15.7% | -0.4% |
| Hamilton - North East | 677,418 | 17.0% | -0.6% |
| Hamilton - Central & North West | 496,659 | 15.9% | -0.6% |
| Hamilton - South East | 484,524 | 13.5% | 0.0% |
| Hamilton - South West | 467,316 | 14.5% | 0.0% |
| Waipa | 496,884 | 21.0% | 2.1% |
| Otorohanga | 258,186 | 15.3% | 4.6% |
| South Waikato | 196,418 | 35.7% | 6.4% |
| Waitomo | 171,185 | 16.5% | -0.8% |
| Taupo | 435,052 | 15.8% | 5.3% |
| Western BOP | 590,608 | 18.7% | 3.3% |
| Tauranga | 676,381 | 18.3% | 0.6% |
| Rotorua | 391,910 | 28.2% | 4.5% |
| Whakatane | 398,552 | 24.5% | 6.6% |
| Kawerau | 171,118 | 43.8% | -3.0% |
| Opotiki | 269,729 | 20.3% | 7.8% |
| Gisborne | 276,793 | 18.0% | 2.8% |
| Wairoa | 170,426 | 16.6% | 3.6% |
| Hastings | 398,612 | 20.4% | 3.0% |
| Napier | 422,945 | 17.9% | 1.9% |
| Central Hawkes Bay | 260,446 | 16.7% | 3.8% |
| New Plymouth | 418,057 | 10.0% | 1.7% |
| Stratford | 234,368 | 9.6% | -1.2% |
| South Taranaki | 200,509 | 7.7% | 1.2% |
| Ruapehu | 162,274 | 16.3% | 4.4% |
| Whanganui | 217,672 | 14.2% | 6.2% |
| Rangitikei | 179,364 | 21.6% | 12.0% |
| Manawatu | 299,293 | 15.2% | 5.1% |
| Palmerston North | 351,959 | 14.8% | 2.0% |
| Tararua | 170,684 | 9.3% | 1.3% |
| Horowhenua | 264,918 | 22.3% | 4.3% |
| Kapiti Coast | 482,789 | 19.8% | 0.4% |
| Porirua | 511,483 | 25.4% | 7.1% |
| Upper Hutt | 442,379 | 26.6% | 4.7% |
| Hutt | 496,314 | 25.6% | 5.4% |
| Wellington City | 716,613 | 20.8% | 3.3% |
| Wellington - Central & South | 714,679 | 20.4% | 2.5% |
| Wellington - East | 781,177 | 20.1% | 5.8% |
| Wellington - North | 644,209 | 23.4% | 4.8% |
| Wellington - West | 808,973 | 17.4% | -0.9% |
| Masterton | 288,996 | 16.5% | 6.3% |
| Carterton | 334,835 | 18.9% | 6.0% |
| South Wairarapa | 387,687 | 20.5% | 6.6% |
| Tasman | 512,754 | 16.3% | 2.7% |
| Nelson | 522,201 | 16.9% | 4.5% |
| Marlborough | 427,552 | 14.0% | 1.4% |
| Kaikoura | N/A | N/A | N/A |
| Buller | 185,358 | 2.0% | -0.3% |
| Grey | 206,297 | -0.6% | -2.9% |
| Westland | 240,056 | 4.9% | 2.7% |
| Hurunui | 372,956 | 3.2% | -0.5% |
| Waimakariri | 438,750 | 3.7% | 1.6% |
| Christchurch | 497,120 | 2.4% | 0.6% |
| Christchurch - East | 372,468 | 1.0% | 1.1% |
| Christchurch - Hills | 669,820 | 2.6% | 2.0% |
| Christchurch - Central & North | 586,247 | 2.7% | 0.1% |
| Christchurch - Southwest | 477,267 | 3.3% | 0.6% |
| Christchurch - Banks Peninsula | 504,734 | 2.4% | -1.7% |
| Selwyn | 546,633 | 2.7% | 0.4% |
| Ashburton | 346,678 | 2.0% | -1.7% |
| Timaru | 338,997 | 6.2% | 1.4% |
| MacKenzie | 449,520 | 30.6% | 9.5% |
| Waimate | 218,755 | 1.6% | -3.0% |
| Waitaki | 261,295 | 10.8% | 1.7% |
| Central Otago | 437,791 | 22.8% | 10.0% |
| Queenstown Lakes | 1,042,258 | 28.5% | 2.0% |
| Dunedin | 363,821 | 15.4% | 2.7% |
| Dunedin - Central & North | 376,502 | 14.8% | 2.2% |
| Dunedin - Peninsular & Coastal | 338,306 | 19.6% | 9.5% |
| Dunedin - South | 343,886 | 14.7% | 1.7% |
| Dunedin - Taieri | 379,103 | 15.5% | 2.1% |
| Clutha | 189,673 | 6.9% | 1.5% |
| Southland | 248,195 | 14.9% | 8.5% |
| Gore | 208,501 | 9.5% | 3.4% |
| Invercargill | 237,168 | 8.9% | 0.3% |
103 Comments
There are definitely different pockets of hot and not so hot spots in Auckland alone so the property values in the Super City cannot be viewed as a whole. Note that North Shore is the hardest hit of all Auckland.
Auckland's average current value is now $1,045,362, while the national average stands at $631,432, according to the QV House Price Index. While quarterly figures were flat, year-on-year Auckland values rose 12.3 per cent, QV spokeswoman Andrea Rush said.
"However, the top end of the market where cash buyers are not affected by the LVRs continues to see strong value growth, with the upmarket suburbs selling more readily and are seeing stronger value growth than those in cheaper parts of Auckland such as the city's southern and western outskirts," Steele said. "This is leading to higher value areas seeing property values continuing to rise in desirable areas with larger homes in central suburbs such as Remuera, Epsom and Mission Bay," Steele said.
Yes it is almost exactly as we predicted/observed except, perhaps, Papakura which appears to have gone up in value even though the text of this article suggests it has gone down.
Central Auckland suburbs (+0.9%), Papakura (+1.2%) and Franklin (+1.1%).
Even Christchurch up so THE MAN 2 should feel vindicated.
You understand the data set though, right? QV is purely 'modelled' prices that try and reflect 'expected' value. Models are reasonably slow moving beasts that require a lot of data points coming in. Therefore, they need to be taken with a grain of salt.
In terms of 'real value', this is best measured with actual sales data over a reasonable time period. Since, after all, a property value is only what someone else will actually buy it for.
Is there any value in it? Good question. A property valuation company generating a model that tells you what the property value is ... oh, it's good... you should do another valuation... oh good, that made the value go up... you should do another/
I recall the Corelogic people getting neg press in Oz over it, when they have a vested interest in the output, should they also control the input?
*sigh* no it's not.
"The average value of all homes in the whole of New Zealand was $631,432" --- did every house in NZ sell?
The E-valuer
An E-valuer gives you an instant estimate of the current market value for a property and is the best source of buyer and seller confidence without the higher cost of a Full Market Valuation. It is an Automated Valuation Model (AVM) and is based on recent, nearby comparable sales created by CoreLogic NZ, New Zealand's leading supplier of property data and analytics. This report is Ideal for preparing to negotiate or looking to see how much your property is worth before selling. Purchasing an E-valuer also gives you:
Recent, nearby comparable sales, also mapped out for convenience
The property’s Rating Value
Additional property details including floor and land area and construction materials.
QV are lagging figures, this is what the market was doing a few months ago -
Seeing an identical pattern to last LVR round : a few months of restructuring (re-fi to a new bank best LVR house(s), re-fi is exempt); then carry on as you were...
Auckland growth has to be limited by the theory of large numbers..
Outside Auckland, as in 2004-2007, another few years of catch up, Golden corridor welly-palmy (inclusive) is where the smart money is starting to pour into
Yes but double digit growth is not sustainable for the long term and quite concerning even for the bulls. I was bracing myself for a storm however around +1% per quarter is sort of my ideal from now on. I would be happy if it stayed at that level or at least averaged at that level for long term stability.
Seriously ... "Housing values down in Auckland & Hamilton, rising in Wellington"
Go to look at how much Auckland is down and it is -0.2%.
Is this a joke?
Can understand if 2% however 0.2% seriously. -0.2% is flat in my book. Good to see MSM trying to push the "Auckland Down" message in the run-up to the election. That is a whopping -0.07% per month or -7/10000 if converted to fractions :) :)
Powers at be must have called for some serious talk down of Auckland property.
The real story here is Auckland Housing $1,050,000 up $550,000 since National took office and nearly 20 times the median wage and over 10 times median household wages.
Up 12% this year despite LVR restriction and now time for Action. Vote the only party that will address the demand issue, Labour:
http://www.labour.org.nz/cracking_down_on_speculators
"Under our policy only citizens and permanent residents will be able to buy existing homes. Removing this speculative demand from the market will help stabilise prices and give Kiwi families a fair shot at buying a place of their own."
Are these figures based off settlement date or sale date? I'd suggest in Auckland looking at the low auction clearance rates that the higher priced properties which are still moving skewing the market price. It will be interesting to see total volume of sales as I expect that to be well down on last year. For example Millwater would be one of New Zealand's largest developments and stock is >double what it was 3 months ago. They are building 50+ houses at any one time priced 1-1.5mil and the market has dropped out. The main buyers now are retired people looking for a single level easy maintenance property. The mansion 5-6 bed double story properties have frozen. And town houses selling for 1m are not moving either. There are no longer many Auctions. Some are listed PBN but most now have an asking prices. A lovely desirable area 20 mins North of Auckland CBD, but times have changed.
My quick search reveals it is 37 minutes away and that is no doubt outside of rush hour. I know a bit picky but that is almost twice 20 minutes. Once Stillwater would have been regarded as almost as far away as Helensville. The motorway systems have certainly improved the property values of these areas but the bridge remains problematic I feel. Hopefully the new systems opening up this year will give alternative options for moving around the city. Quick access is essential for good locations which is why my bet would be on West Auckland.
He was talking about Millwater.. which isnt too different but has its own offramp now so is a lot quicker.. https://www.google.co.nz/maps/dir/-36.8509128,174.7752929/-36.6037669,1…
My search was from Parnell as getting through the city at the moment is a nightmare (and misleading) and this is slightly more distance as well, for 27 minutes which includes morning traffic on the bridge (at the time of search). With the extention of the busway, it would still be a pretty good in peak traffic taking public transport.
But i knitpick.. 1.whatever million is still FAR too much for a house that far from the city..and a lot of that comes back to the ridiculous land price.
Hi Zachary, Millwater with it's own ramps to the Motorway is 20 mins to the fringe of the CBD, with no traffic. Probably 25-30 mins with Avg traffic, reaching 1-1.15 during rush hour, which is better than the southern. The Northern Express goes to Silverdale every 15 mins, and the Busway is being extended to Oteha valley next year... Saying that Traffic is getting considerably worse with all the new houses going in.. As might say Double GZ is certainly a lot more central and an easier commute to the CBD. West Auckland motorway works is certainly going to help them, until they get close to the CBD which will be the new bottleneck, and new Airport traffic.
Good luck driving into the city from Stillwater in morning peak traffic Zach
Face it Auckland has become a congested city
Once Australia gets rolling again watch the exodus from Auckland
Nice to see yet another think tank is being formed on infrastructure !
NZ does meetings $ reports so well
Good luck driving into the city from Stillwater in morning peak traffic Zach
Face it Auckland has become a congested city
Once Australia gets rolling again watch the exodus from Auckland
Nice to see yet another think tank is being formed on infrastructure !
NZ does meetings $ reports so well
Looking at the details on the QV report, while the index is sales figures, the average value is not...
"the average current value is the average (mean) value of all developed residential properties in the area based on the latest index. It is not an average or median sales price, as both of those only measure what happens to have sold in the period."
20 mins from the CBD at 3am Sunday morning. In rush hour an hour and a half away. I know of three large home building outfits that are either in liquidation or very close to it, all volume home builders on the shore, combination of mismanagement and believing the hype ?
1. Election year ,
2. Media talking up the Auckland price drops despite -0.07% monthly drop,
3. Chinese Government limiting currency withdrawals for overseas property. (30 to 50k )
My guess is 3 is the main driver as it is in other markets offshore.
http://www.theaustralian.com.au/business/opinion/robert-gottliebsen/cas…
'Finally it has happened. Chinese buyers have markedly reduced their buying of Sydney apartments.
I was alerted to the Sydney decline by the city’s largest apartment owner and developer, Meriton’s Harry Triguboff. Chinese and other Asian buyers have dominated Sydney apartment buying, at times reaching 80 per cent of the market.
Let’s use Harry’s words to describe why Chinese are pulling back. “The reason is that it is harder for them to get money out of China (Beijing limits cash exports to $US50,000a year per individual). The Chinese buyers must now get financial assistance either from developers or banks. (Meriton is funding Chinese buyers who bought off the plan and now need help to settle)."
Apartments are like a separate market really. I have always felt you won't get rich buying apartments as they haven't historically done all that well. It's a bit like at the Casino when the table is full. Do you put your money behind the player who has a big pile of chips or a small pile of chips?
That wasn't the point of what Joe Public was saying. The point was asset prices here are overinflated inflated due overseas money flooding the market and now the tide is going the other way. He’s right. You said yourself you are expecting a storm. I agree with you, this is the calm before the fun starts.
Bang on M.A... and in Australia remember Foreign buyers are NOT allowed to buy existing properties so they are stuck buying apartments (new builds)
http://www.sro.vic.gov.au/foreignpurchaser
Foreign purchasers
You will be a foreign purchaser if you are a foreign natural person, a foreign corporation or a trustee of a foreign trust.
Foreign natural persons
You are a foreign purchaser if you are not:
- A citizen or permanent resident of Australia,
- Or a New Zealand citizen with a Special Category Visa (Subclass 444)
Like Labour's new policy !!!! #lovelabour
"Under our policy only citizens and permanent residents will be able to buy existing homes."
Double GZ Labour got you rattled?
I guess lots of other Real Estate agents feel the same way. Don't want to mess with the status quo .
Labour's policy seems like common sense. Put NZ citizens and Permanent residents first.
"Under our policy only citizens and permanent residents will be able to buy existing homes. Removing this speculative demand from the market will help stabilise prices and give Kiwi families a fair shot at buying a place of their own."
Print it and hang it up in your office today :)
Our people .... haha.. you mean real estate agents ?
here is a video you can watch now that your real estate business is slow;)
Auckland has had Labour mayors for 7 years now, Len Brown and Phil Goff have been exceptionally good value for the real estate agents. Labour has been restricting land supply to Auckland and building new suburbs miles away.
Labour - long polluting commutes, heaps of traffic and no homes getting built.
Labour are worse than National.
DGZ - Phil Twyford could well become the hero of a disenfranchised generation of New Zealanders that the National party abandoned. It’s interesting that you should character assassinate him out of the blue. Who would do that? maybe a paid employee of Nationals PR company “Croxby Textor”, or perhaps Cameron Slater, or perhaps someone inside the National party…. eeeek
Don't fall for the trap, Joe Public, you had it the right the first time. The Chinese cannot transfer money anymore without risking getting caught by SAFE since the restrictions in January 2017.
This year they may still be fine, but next year is a totally different story.
"For Zheng, the decision on whether to walk away from his Melbourne property or risk breaking China’s foreign-exchange rules is fast approaching. He’s scheduled to wire another 800,000 yuan to Australia in late February to cover the rest of his down payment.
“I can probably meet future mortgage payments with rental income from the villa, but a more imminent problem is whether to wire money abroad now,” Zheng said. “I’m not too sure about that. It’s safer not to stick my neck out."
https://www.bloomberg.com/news/articles/2017-01-26/world-s-biggest-real…
Chinese people and others have a much longer view of things than your typical property speculator. As I have stated before they are not buying for capital gain only. China is an authoritarian state while Auckland is a safe, modern, prosperous and free, English speaking, British heritage, cosmopolitan city with an international airport. You can't actually go wrong buying in Auckland from their perspective. Even rich Chinese want to live in Auckland and have their children go to nice schools and tap into all the opportunities the entire Western world has to offer. It's not fundamentally about making money.
The choice is not only between Auckland and China, but Auckland and other western cities.
Vancouver is now seeing some Chinese investors picking up sticks and heading elsewhere, anticipating long term stagnation or decline in prices.
It shows that there are political measures that can be implemented that will ultimately cool the market and gradually make it about home ownership rather than investment once more.
You're behind the curve and missing the bigger picture Zachary. It's just they just want the same middle class values and comforts of home that the rest of us hanker for. So they're quite happy to setup home, much closer to home. Remember; China is going through a huge economic change, moving from an industrial focus (Which lest them with huge pollution problems), to an Technological focus.
And they're building new cities to support their new future and the best of luck to them, right now I think they have a much brighter future than the Americans.
BBC Business Matters: Property Buying Frenzy in the City That Doesn't Exist
http://www.bbc.co.uk/programmes/p04yc2h4#play
Sale volume is very low, listings are very high and prices by slowing, stagnant or downwards. Backwords, sideways, descending, slowdown, downturn… use whatever semantics you like.
Let’s get something clear though. If money came from China to buy a house and they sell it doesn’t get sucked back into China by default. There are plenty of other places to put money that will not slowly loss value in the near term. These properties were bought as investments so will get traded just like any other investment asset.
Apartments don't do well in Auckland, but in the real world they out perform houses. Brisbane, Melbourne, Sydney - apartments are king investment in their boom.
In the real world cities grow in an economical form that agglomerates increasing value to the centre, apartments at the centre make the big gains.
In cuckoo-crazy land we spend $billions developing exurbs miles away from the city and sprawl wildly into the distance. Apartments do poorly compared to houses.
Auckland Council planning FTW.
Wouldnt touch apartments with a barge poll.
Leaky buildings, under funded maintenance funds, body corporate issues, leasehold, way too easy to over supply the market (bung another 20 storey apartment building next door compared to the difficulty increasing stock of character villas in Mt Eden)
For some time Interest.co.nz when reporting the weekly Auckland Apartment sales reported the previous sales history and in many if not most cases the vendor was taking a large hair cut not only in price but had been voluntarily locked in for 10 years awaiting recovery
When markets are quiet and people aren't buying is when you should be buying if the figures stack up and you can see upside or you can improve.
Opportunities are always around you and the people who get ahead in life are the ones to take a punt.
Christchurch is definitely a desirable place to live and invest in and still extremely affordable for most, and with the rebuild still happening will be the city of choice in NZ going forward.
It's far easier to get ahead in life and buy a property when you're a trust fund baby or your parents go guarantor on your house. For the majority of us who aren't so lucky it's a long slog to save a deposit. I personally have lived in Christchurch my whole life up until 2012 and will never go back there. I find it a boring city with no jobs in my field.
The bottom end of Auckland is dropping out but the top end is holding up, for now. Therefore you would expect to see the median drop more than the average.
REINZ stats will be interesting. Volume sold down, days to sell up, prices probably flat for another few months until the real fun starts.
On the radio this morning the bubble has not burst and the small leak that was going psssssst has already been patched. Some areas already going up again we have already bottomed out. Year on year gains still huge so get in now if you can afford to do it but factor in potentially higher interest rates. Nothing has changed really. Also record new car sales this month.......again as it has consecutively been for the last 3 years. Gee my 2004 Subaru is now an old banger, must be one of the few that can pull their head in and resist putting a new car on the house.
Yes, supply is an issue. How do you think we get cheaper rent?
Rent depends on supply, as the house price comes down and we build fewer and fewer houses the rent will go up faster and faster.
The only way to get cheaper rent if we don't build homes (and we definitely don't build hoses in Auckland) is for everyone to move to where they do build.
By building an oversupply of homes (like in Aussie) when a correction occurs at the end of a cycle the house prices fall and the rents fall. However these are attractive things for people and businesses who come in, bringing jobs with them. So their wages don't fall so much and house prices stabilise. And the cycle repeats itself.
Auckland builds an undersupply of houses, guess what is about to happen.
Lets look ahead to the prospect of a NZF and Labour led Govt after September. Winston's Land Transfer (Foreign Ownership of Land Register) Amendment Bill only failed its first reading by 3 votes and was withdrawn. Dollars to donuts it will be reintroduced and passed unless National maintains its near majority. Its not much of a stretch to see proposed register make its way to Chinese government hands when such an important trading partner demands it to start "discussions" with its naughty citizens.
The choice for the Chinese escaped money when they get a please explain is a) to sell and expatriate the money back to china with a big penalty (read in any capital gain) or b) get registered on the organ harvesting list alongside the Falun Gong.
Would be interesting what impact this might have on specuvestor land. That said we still cant evict the Fat German so it might never happen...
It will only benefit any middle class people who have the required amount of savings to purchase investment properties and so will be able to live in a house they own. Poor tenants will be evicted and be faced with homelessness or high rents. The number of houses being built will fall even further and a large number of low skill labouring jobs will cease.
When in Beijing do as the Beijingers do
A local married couple, from this week, can only own one apartment and one house.
Non-residents cannot buy a single-storey house unless they have paid tax in the city for five years
http://www.smh.com.au/world/beijing-slaps-real-estate-ownership-restric…
IMO we have reached a sort of peak in AUckland at least, because the prices are at the limits of what a working couple can afford to pay, and what banks are comfortable at. We are also not getting a lot of people renting out parts of their house for AirBNB, because they want to pay of their mortgage easier. Unless we allow 3 person marriages, I can't see prices rising too much more, unless wages increase too. Wellington has a lack of supply in the city, and people want to be in a good school zone. Maybe if we got rid of school zones, it could mean people can live where they want to live, without it affecting the schools the kids could go to.
That assumes the only people buying are NZ citizens ... when NZ is open for sale on the Global Market then it is a different story.
Remember we have the worlds lowest Purchase Tax for Foreign Buyers ZERO% . A house in Auckland is still relatively cheap when compared to an apartment in Hong Kong or London for example.
The stall in prices is a reflection of the Currency Controls the Chinese government brought in. No more no less.
Labour's new policy will address that so we don't need to rely on foreign governments to Curb demand on NZ property.
http://www.labour.org.nz/cracking_down_on_speculators
Under our policy only citizens and permanent residents will be able to buy existing homes. Removing this speculative demand from the market will help stabilise prices and give Kiwi families a fair shot at buying a place of their own.
That assumes that what National have said is incorrect, and that we don't have a problem with overseas buyers buying NZ houses, and pushing up prices.
But I agree that we do have a problem with overseas buyers buying existing houses. They should be made to build new ones, which seems to be standard in places in Australia. But we also have a lot of other things pushing up prices, such as a lack of competition in the building materials sector. Lack of builders, plumbers, electricians, which means they are now earning huge salaries in many cases.
It is not just overseas/off shore buyers.
Foreign Students and Temporary Visa workers are also foreign buyers and the current National Government does not classify them as Foreign buyers. On the LINZ results (before they pulled the plug on reporting Students & temp workers) this group made up 30% of the Resident Buyer total.
Labour will classify these as Foreign Buyers to bring NZ in line with Australia. Only NZ Citizens and Permanent Residents will be allowed to buy existing homes.
Yeah...the last nine years seems like National trying to obfuscate and hide at every opportunity, the more to resist taking any action that will affect the personal dollar balances of their core investor-voter bloc. Young Kiwis appear to have been sacrificed for these voters' personal gain.
Often reading on here in the comments sections the Trade Me inventory numbers for Auckland hovering around the 11k mark. Interesting to read here (link below) about Wellington sales, albeit from a RE Agent press release. 1543 properties for sale in March (up from 1029 in January)
http://www.scoop.co.nz/stories/BU1704/S00120/wellington-housing-market-…
So 7 x as much property for sale in Auckland than in Wellington, for a city 3 to 4 as big. Supply side, demand side etc etc etc, although I guess the discussion is now turning to 'supply side' also in Wellington. Although this discussion can easily get railroaded by agendas when using photos of queues on the street to view student flats in Feb (when it is always busy).
The article also has some interesting comment on consents, and WCC plan for a $5,000 rates incentive for first home builders. Not something I had heard of before.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.