Super City bucks trend

Wednesday 1 February 2017

Asking prices hit new records in markets around the country but the formerly hot Auckland market is not among them, according to realestate.co.nz’s latest data.

By Miriam Bell

The website’s data showed that the national average asking price inched up by just 1.1% to hit an all-time high of $624,709 in January.

But average asking prices in nine out of the 19 regions soared to record highs in January.

Realestate.co.nz CEO Brendon Skipper said the most notable of these was the Central Otago/Lakes region, which saw its average asking price increase by 17.6% to reach $888,567.

“However, the full set of statistics would suggest that seasonality is still in full swing.”

While the Central Otago/Lakes region had the biggest jump in average asking price, other regions also recorded strong increases.

Average asking prices in Central North Island were up by 12% to $413,392; in Hawkes Bay by 10.8% to $413,405; and in Bay of Plenty by 9.8% to $592,479.

Other upward movers included Wellington (up 5.6% to $556,807); Taranaki (up 4.8% to $387,594); Manawatu/Wanganui (up 4.7% to $310,437); Otago (up 4.6% to $358,897); and Coromandel (up 2.3% to $700,352).

Skipper said it is too early to tell if this upward spike will be a trend for 2017.

But Wellington was an interesting market to watch as its average asking price hit at an all-time high in January, he said.

“However, it’s looking light in terms of listings with only six weeks’ worth of inventory, compared to 16 weeks in Auckland.”

Realestate.co.nz’s data showed the Super City went against the broader trend in January, with inventory up and average asking prices static.

The region’s average asking price was $943,002 in January, which was 0.7% down on December’s average asking price of $949,898.

Skipper said that it is also too early to say whether Auckland’s asking prices have been affected by the traditional seasonality, given the asking price remained quite static in January.

“However, new listings are up 5.5% compared to January 2016.

“We have seen another drop in demand in Auckland, down 25.39%, meaning buyers can approach the market with more choice.”

In terms of inventory around New Zealand, Auckland is sitting at 16 weeks; Taranaki is sitting at 17 weeks; Manawatu/Wanganui is sitting at 13 weeks; Otago at 11 weeks and Coromandel at 35 weeks.

ASB economist Kim Mundy said the data showed the number of houses available for sale rose in January, despite a fall in new listings.

This implies that the latest LVRs and, possibly, recent lifts in long-term mortgage rates are weighing on housing demand, she said.

“We expect housing activity to continue to cool as we head into 2017 and, as a result, inventory levels could continue to climb slightly higher.

“However, inventory levels remain very low from a historical standard and, combined with ongoing high levels of net migration, this will continue to support house prices.”

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