Smaller options drive February rebound

Following two months of falling prices, the national average asking price edged up by 1.5% to reach $616,050 in February.

This means that the national average asking price was up by 11.9%, or $65,000, year-on-year.

Head of Trade Me Property Nigel Jeffries said the national property market was returning to normal after some quieter months over summer.

“That growth is always dependent on the enormous Auckland property market which returned to growth in February, albeit by a meagre 1.2% over the past month.”

Auckland’s average asking price increased to $906,350 in February, following price declines in December and January.

This equated to price growth of 10.9%, or $89,200, for the Super City over the past year.

Meanwhile, Wellington’s property market continues to run hot, with the average asking price up by 2.6% to hit a new record of $528,000 in February.

Jeffries said the Capital had set five record prices over the past six months and was showing no signs of letting up.

“There are huge numbers of people looking and the supply of houses for sale just isn’t getting anywhere near the demand.

“That’s resulted in a surge in the average asking price of almost $60,000 over the past six months, which is around 12.7%.”

Year-on-year price growth was strong in most markets around the country – with just Gisborne (down 2.6%) and Canterbury (down 0.5%) showing declines.

Jeffries said Otago has had a “massive” year with the average asking price in February hitting $492,950, and up 22.7% on this time last year.

“Otago looks like it is being pushed along by Queenstown, with the latter emerging as the first district in the South Island to top the $1m mark for the average asking price.

Queenstown’s average asking price was $1,057,000 in February, which was a year-on-year increase of 42%.

Interestingly, it looks as though small houses (one to two bedrooms) and apartments are a driving force in the market rebound.

Jefferies said buyer demand for small houses was high in February as buyers looked for the most affordable rung on the property ladder.

In both Auckland and Wellington, small houses reached new record average asking prices of $718,850 and $398,300 respectively.

These prices reflected year-on-year growth of 15.6% in Auckland and 17.1% in Wellington, which was considerably higher than the growth seen across all properties.

Jeffries said the apartment market is also now back “firing on all cylinders” after a very slow period.

The average asking price for an Auckland apartment reached a new record high of $622,400, which was a year-on-year increase of 21.2%.

But Christchurch was not left behind either.

While price growth in the wider Christchurch market was just 0.7% year-on-year, the city’s apartment market saw year-on-year growth of 28.3%.

Jefferies said the average asking price of an apartment in Christchurch has now hit $442,650.

“The city’s apartment market has surged as more and more new inner city apartments hit the market.”