Not everyone's enjoying a house price boom
Tuesday 6 July 2004
Life is never fair. People in some parts of the country are doing a lot better than others in the residential property market. And a fast-changing job scene is creating significant anomalies in wage packets, with experienced staff finding new colleagues can be better paid.
By The LandlordLast week's column noted that Quo table Value estimated house prices had risen 22 per cent in the year to March.
Yet home owners in New Zealand's biggest suburb, Wellington's Karori, don't seem to be enjoying the boom. There, prices have risen by a modest 6.9 per cent in the year to May – from $385,350 to $413,000, according to Real Estate Institute figures.
This suggests that people in Wellington's western suburbs have reason to be grumpy. They appear to be paying rising mortgage rates as the Reserve Bank battles soaring house price rises in other parts of the country.
Real Estate figures show that in the same period the average house price in Timaru jumped by more than a third – from $95,000 to $145,000. Those in Hamilton City also beat Karori, rising from $175,500 to $217,000. Home owners in areas of especially high demand, such as Nelson, have had bigger increases.
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There’s no sign of a slow-down in Wellington’s property prices with Trade Me Property’s latest data showing that asking prices continue to rise solidly.
Vacancy rates in the commercial property sector are set to increase as changing economic conditions dampen demand.
LVR restrictions were never meant to be a permanent feature of New Zealand’s housing market and ANZ economists argue that some further relaxing of them could soon be on the cards.