Auckland juggernaut powers on

The latest Trade Me Property Price Index shows that, in the three months to September, the average asking price in Auckland rose by 0.7%, leaving it at $776,000.

This took the annual rate of growth to 19.7% and the 5-year increase to 63%.

It means Auckland’s average asking price has gone up by $300,000 over the past five years.

Head of Trade Me Property Nigel Jeffries said that just when it seems the Auckland property market can’t surprise you any further, another incredible statistic emerges.

He said that between September 2010 and September 2013, the average asking price increased by $100,000 and then prices ramped up further over the past two years.

“Since September 2013, the average asking price has jumped by $200,000 which is a staggering amount of growth for any market.

“We saw a small dip in July but it was an exception and there has been an increase in the Index for 12 of the past 13 months.”

However, while the August price data showed growth in prices (of 1.9%), it followed the July drop (of 2.2%), and falls far short of the growth recorded earlier this year.

In comparison, Trade Me Property’s data shows that both Waikato and the Bay of Plenty have been experiencing strong growth over recent months. 

Waikato’s average asking price rose by 2.2% in September, leaving it at $389,900.

This took the region’s annual rate of increase for the region to 11.5%, which means $40,250 has been added to Waikato’s average asking price over the past year.

The Bay of Plenty’s average asking price rose by 0.8% in the month, which left it at a record high of $471,600.

This means the region’s average asking price has increased by 11.3%, or $48,000, over the past year.

Jefferies said both regions are seeing strong growth in average asking prices off the back of “the Auckland effect” – due to Aucklanders looking to invest in more affordable neighbouring regions.

For the rest of the country, the picture is not quite so rosy.

Once Auckland is excluded, the national average asking price has plateaued at $400,000 after an increase of just 0.5% in September.

This means annual growth in the national average asking price came in at 3.8%, or $14,850.

Jeffries said that, while some regions are performing exceptionally well, nationwide it is pretty quiet.

Over the last five years, average asking prices outside Auckland have increased much slower than in Auckland, he said.

“They’re up by 19%, or almost $66,000, since September 2010. This is still solid growth, but Auckland’s spectacular growth makes for an impossible yardstick.”

While 10 of the country’s regions recorded growth in average asking prices in September, four recorded falls.

Both Taranaki and Otago are experiencing tough times and continue to see their average asking prices declining, Jefferies said.