Auckland Council's rating valuations have increased by 50% or more in almost of third of the city's suburbs and districts since the last revaluations took place three years ago.
The average increase across the entire region was 46% and of the 237 suburbs and districts, 74 (31%) recorded rises of 50% or more.
The biggest increase of 151% was in Paerata/Runciman on the region's southern flanks, followed by Wainui/Waitoki (+102%) north of Kaukapaka in rural Rodney.
Other areas to record very high revaluations gains were Drury (+81%), Karaka/Kingseat (+73%), Rosehill near Papakura (+73%), Surfdale on on Waiheke Island (+71%), and Westgate (+86%) and Whenuapai (+74%).
A notable feature of the latest revaluations is that values in areas that have traditionally been considered the most affordable housing areas have generally risen at a much greater pace than the more expensive areas.
Cheaper housing areas include Otara (+64%), Otahuhu (+58%), and Massey (+55%), which have recorded value rises greater than the regional average of 46%.
But areas such as Epsom (+39%), Grey Lynn (+40%), Herne Bay (+42%), and Remuera (+42%) have posted value increases below the national average.
The greater growth of values in the more affordable areas is probably the result of speculative investor activity driving up prices, as investors chased capital gains ahead of rental income growth over the last few years, whereas buyers in more affluent suburbs are more likely to be owner-occupiers.
Unfortunately that also means that in percentage terms, rates increases are likely to be greatest in the cheaper parts of town, where people tend to have lower incomes, and lower in the higher priced suburbs where incomes tend to be higher.
Here's the full list of indicative value changes by suburb/district:
The latest rating valuations for individual properties are available on Auckland Council's website:
67 Comments
Sure rates increases (as a percentage) are higher in the southern low priced areas. With the uniform annual general component being set low by the left leaning council in Ak, and the variable component set relatively high, this valuation increase in low priced areas does have a higher impact than what the left would want.
However the absolute value of rates paid will still be significantly less than those paid in the higher priced suburbs.
Who knows one day you might actually have all your mortgages paid off DubleDZ
Keep working hard
Let me tell you nobody here talks about their neighbours real estate values like you do unless from New Jersey Ha!
One day you’ll develop & learn trying to impress the way you do is utter crassness
6,528 Buyers in Auckland this year so far have paid too much for their houses already!!!
"Goodall said the latest valuation figures showed there were slightly more Aucklanders in the winning category. Of the 14,795 property sales he analysed this year, with just over, 7,589 half buying for less than their new RV.
Goodall said "interestingly" 678 properties sold for bang on their new RV."
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=119…
So glad that both Epsom and Remuera made the list!!
Most expensive Auckland streets based on median RV
Cremorne St, Herne Bay $6.3m across 14 properties
Stack St, Herne Bay $5.6m across seven properties
Westbury Cres, Remuera $5.35m across 12 properties
Omana Ave, Epsom $4.9m across 20 properties
Judge St, Parnell, $4.8m across 11 properties
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11945800
TTP, I expect most Auckland properties will reach 8 digits in my lifetime.....I also want to know how you explain the rationale. Is it derived from the same fortune cookie packet as, Auckland prices will oscillate in the foreseeable future and Auckland prices will take off again in the later part of 2018? Please, no more waffle and just answer the question!
Hi R-P,
Following every significant property market upswing in the last 70 years in NZ, there have been those who have come forward saying that (average) prices have become unsustainable and predicted that a "crash" will occur........ But no "crash" has ever eventuated. Historically, prices have tended to level off (fluctuating a little) and eventually moved up again.
This sort of scenario is highly likely to be repeated (even though most contributors here dispute that).
Yes - it's still possible that prices will head north again at some point in 2018. But, I now think it's more likely they'll oscillate around their current level for the foreseeable future - which is what I've been saying since the formation of the new Government.
Please note that I have never said, simultaneously, that prices will oscillate and that they will take off again in the latter part of 2018. (That would be somewhat contradictory.) Note that I never used the term "oscillate" before the formation of the new Government.
Like anybody else, I'm entitled to revise my views as updated information/data becomes available - and have done so over the last few weeks. The policies of the new Government have led me to believe that property prices will more likely oscillate in 2018 - rather then move upward to any significant degree.
That is my current position and I hope you are now clear on that.
TTP
Hi TTP, to coincide with this biggest market upswing in 70 years the world has been subjected to the lowest interest rates in history. What do you think the market will do as QE is withdrawn? Being that interest rates are still low, how effective are these old tools in preventing repeat GFC?
Right now, Is China in a position of strength like it was in 2008 to prevent a sudden collapse of its many bubbles and lastly, is China going to be our White Knight or our Black Swan next time?
I say, FHB, wait there is no hurry. If you're highly leveraged get out of debt fast. Looking forward, I feel the risks are mounting quite quickly and quite unnerving to be honest.
Hi R-P,
I wouldn't be advising anyone to hold back from buying their own home - including FHBs.
If you wait, wait, wait and prices creep up then you only end up being further behind. I know that sounds simple and obvious - but it can easily happen if you're too passive. People need to understand that.
Taking on a mortgage when you're young, qualified and have career prospects is absolutely commonsense, in my view. Things can become much tougher as one ages....... the sooner you get established/secure the easier life can be.
People need to understand that - otherwise one can be destined to a life of paying rent (and the insecurity of renting and being at the whim of landladies etc). I doubt that's what most NZers want.
How many people regret buying their own home 5,10, 20, 40 or 60 years ago? Chances are it won't be any different in another 5, 10, 20, 40 or 60 years time.
TTP
TTP, are you saying the future will be the same as the past? I'm confident In Ireland, USA and Spain the same was said in the Cafes in 2006. Its when the majority of the population are least prepared - it happens big. No one likes these sorts of surprises and it wrecks families. It's the Property Spruikers and commission takers that don't consider the grief debt stress causes families. If FHB get this wrong it's a rude awakening to find that your Bank is really your Landlord. FHB, there is no hurry, wait for the distressed sales.
I don't think FHB's have a choice but to wait. Foreign investors are in the process of being banned and the banks are facing funding issues and in particular, one bank named Westpac has been given 18 months by the RBNZ to raise its capital to meet requirements by order! As Westpac is a major landlord in the housing loan portfolio, I am wondering how many other banks might need to re-value their portfolio's and request higher repayments from their customers. It is a bit frightening really.
"The greater growth of values in the more affordable areas is probably the result of speculative investor activity driving up prices" - a bit of an assumption isn't it? A large part would be first home buyers on good incomes that can no longer afford the former Auckland City Council area and have to buy their first house further out (or indeed the speculation that this is the case).
Penguin, This is the thing that makes me scratch my head. Some commentators talk about a rental property which starts out negatively yielded and taking over a decade, nearly 2 decades to start paying a good yield. And I always think.... but what about rates and maintenance?
I am an accidental landlord, in the sense that we rent out a house in the UK that we used to live in. For various reasons, the money was better left in the house, than cashing up at the time we moved to NZ. But, even though, technically the house gives nearly an 8% yield, any income than I get above what covers the mortgage, letting fees, regular maintenance costs etc, goes into a kitty to cover the inevitable bigger spend maintenance issues that will undoubtedly occur.
When people talk about long term letting from a property that started out heavily negatively geared, they never mention what I would consider reasonable maintenance costs. And that now makes sense to me, having looked at properties that get offered for rent, and what a terrible condition so many of them are in.
gingerninja, reflecting the real risks and costs associated with owning and renting out houses, I'm also wide eyed as to why it's not at least 8% here. Interest rates are higher here than in UK - right? It can only be the unrelenting chasing of capital gain by a foolish herd. If yields were to return to 8% then that would imply quite a correction indeed. If others suggest that rents can continue to rise enhancing the yield on lofty valuations think again because labour markets have cycles too and can render many houses/units vacant.
Why on Earth would the property have been allowed to become Positively Geared in the first place?! Isn't that the Name of The Game - let the taxman pay it off for you? Like as not, in the 10 years since purchase another (s) property has been added to the portfolio - to keep it all NG - and all that there really is, is the risk - Those Capital Gains you mention? Are all tied up in today's price....
No need to worry too much about these valuations. Most of us who've been around for a few decades know there's a decent recession looming and AK will get hit hard. We'll see those $1m properties back down to $750k again pretty quickly. That'll put most newish buyers, those first home buyers during the last couple of years, into negative equity and negative net worth. Like several who got slammed by the GFC they'll never recover. They'll get mortgagee sold up and go back to renting. It's what they voted for. Their Coalition of the Greedy will strip them of their wealth and make them needy. It's what happens when people only look at what they can bludge out of the system. People my age know that's not how the real world works.
Surely the coalition of the greedy would be the party that allowed house prices to increase by 46% in the three years since the last valuation?
I'm sure that the COTG would explain these price rises as a "product of our success" and a natural response to supply and demand. I don't think they would take direct responsibility of "allowing it to happen". That would sound a little like a planned economy.
And most of the younger people I know understand the benefits of diversity - these days the research is so much more accessible. It's the people who caught the huge and likely unrepeatable property price gains recently that seem to be blinkered to the risks of being in a single asset class.
mfd, very true. As a young thing, I remembered my first wins on sharemarket. I felt like a winner - I was flying high like I was on cocain. Then it all crashed. I learned very quickly the value of working hard for a living, saving with diversity, diversity and diversity ha-ha!
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