INDEPENDENT NEWS

Winter fails to take the heat out of the property market

Published: Mon 22 Jul 2019 08:32 AM
Winter has failed to take the heat out of the New Zealand property market and as temperatures dropped in June property prices rose, according to the latest Trade Me Property Price Index.
Head of Trade Me Property Nigel Jeffries said thirteen of the country’s fifteen regions experienced year-on-year growth in June. “Conventional wisdom suggests that selling in winter is unwise - sellers are worried there are less buyers and that their property might not look as good as it can under that summer sun.
“From what we’re seeing they don’t need to worry - there is strong demand right around the country and sellers who are confident they’re going to get a good price.
“The only regions to experience the winter blues were Taranaki (down 3.4 per cent) and Auckland (down 2.4 per cent).”
Mr Jeffries said the national average asking price rose a “modest” 1 per cent on last year to $648,650 in June. “However, if we exclude Auckland, the average asking price in New Zealand rose 6.8 per cent on last June to $540,600. Property prices in Gisborne experienced a 16 per cent jump when compared to last year while Southland rose 15.8 per cent. Manawatu/Whanganui was also up a significant 15 per cent year-on-year.”
Mr Jeffries said a combination of low interest rates and increased competition was driving price increases across the regions. “With interest rates at an all-time low and word they could be trimmed again, some buyers appear more motivated to get a foot on the property ladder.
“Buyers are also facing more competition. In June we saw a 10 per cent bump in the average number of views nationwide when compared to 2018. The number of properties on the market is more or less the same so sellers should hope for plenty of interest in their property with supply not meeting demand.”
Auckland property prices fall to lowest since 2016
While most regions saw year-on-year growth, Auckland’s average asking price fell to its lowest since September 2016 - dropping 2.4 per cent year-on-year to $887,950 in June.
Mr Jeffries said Auckland’s property market continues to decline. “In May we saw the largest year-on-year percentage decrease since 2014 at 1.9 per cent. In June it fell even further dropping 2.4 per cent, causing prices to tumble another $13,700 on May.
“Auckland has seen phenomenal growth over the last few years and it’s unsurprising the market has finally taken a break. We’re watching with interest to see how this trend will continue, our prediction is we’ll see further dips in the coming months before it rallies in Spring.”
Mr Jeffries said buyers in the region are opting for smaller, more affordable properties. “The only property type in the region to see year-on-year growth were apartments which rose 3.4 per cent to $665,200,” he added.
Wellington property prices run hot
Mr Jeffries said Wellington continues to be a stand out as property prices in the capital keep rising.
“The average asking price in the Wellington region climbed 10.8 per cent on the year prior, or $62,450, to $642,900 with all but one district seeing strong year-on-year growth.”
Mr Jeffries said Upper Hutt and Porirua saw “incredible” growth in June jumping up 20 per cent and 17 per cent respectively on 2018 to reach new records at $613,850 and $686,850.
DistrictAverage Asking Price (June 2019)Year-on-year changeWellington$760,350+9.5%Lower Hutt$587,100+10.5%Upper Hutt$613,850+20.2%Porirua$686,850+17.2%Kapiti Coast$597,900+5.5%Masterton$398,800+5.0%Carterton$460,350-0.5%South Wairarapa$573,750+11.6%
“Wellington simply doesn’t have enough available properties, the demand for housing is pushing prices up and we don’t expect that to change any time soon.”
Waikato hits new high, again
Mr Jeffries said the average asking price in Waikato reached a new high for the fifth consecutive month rising 8.8 per cent in June to $591,650.
“If we look back over the last five years, property prices in Waikato have increased rapidly as more Kiwis look to move out of the main centres. Prices in Waikato have risen 65 per cent since June 2014 when the average asking price was just $358,450.”
Large houses (5+ bedrooms) fall
Mr Jeffries said nationwide, large houses (5+ bedrooms) were the only house size to take a hit in June, falling 1.9 per cent to $1,108,250. “Medium houses (3-4 bedrooms) and small houses (1-2) bedrooms hit record high across this country hitting $654,150 and $447,600 respectively.
“Auckland’s market has softened almost right across the board, all house sizes in the Super City saw a dip in average asking price in June. Large houses in Christchurch were a stand out in June, rising a significant 14.3 per cent year-on-year to $832,950,” he added.
Units dip in the three main metros
“Across the three main metros, the average asking price for units fell in June. The biggest dip was in Wellington where the average asking price for units fell 13 per cent on last year.
“Townhouses in Wellington, on the other hand, were up almost 19 per cent with several new townhouse developments in the region likely driving this increase,” he added.

Next in Business, Science, and Tech

Next steps for Auckland light rail
By: New Zealand Government
Gender pay gap unchanged since 2017
By: Statistics New Zealand
Stuff pulls pin on media companies' joint ad-buying business
By: BusinessDesk
Transdev to Acquire Auckland And Wellington Bus Businesses
By: Transdev
Twyford's choice: NZTA or Super Fund for Auckland light rail
By: BusinessDesk
A whole term of Government with no shovels in the ground
By: New Zealand National Party
Transport Agency welcomes next steps for light rail
By: NZTA
Light rail delay creates highway opportunities
By: Automobile Association
Government taking action to close gender pay gap
By: New Zealand Government
Genter delaying pay equity for publicity stunt
By: New Zealand National Party
Gender Pay Imbalance - call for PM to take action
By: New Zealand Council of Trade Unions
Persistent gender pay gap - need for Govt to move faster
By: NZEI Te Riu Roa
Opportunity to fix the gender pay gap in tertiary sector
By: Tertiary Education Union
Government must take the handbrakes off, deliver equal pay
By: Public Service Association
View as: DESKTOP | MOBILEWe're in BETA! Send Feedback © Scoop Media