Auckland house prices plateau

Property Editor·NZ Herald·

12 May, 2015 05:00 PM4 mins to read

Real Estate Institute data showed median prices fell between March and April. Photo / Fiona Goodall / Getty Images

Median dwelling sale price sits at $720,000 for a month but REINZ says this does not signal end of housing boom.

The Auckland region median dwelling sale price remained frozen over the last month at $720,000, but dropped in three areas.

Real Estate Institute data showed median prices fell between March and April, from $642,500 to $633,000 in Waitakere City, from $850,000 to $789,000 in Auckland City and $698,000 to $691,500 in the Rodney District.

The drop has been put down to the cooler weather and lower deal volumes.

But on the North Shore, prices went up $60,000 - $2000 a day - from $865,000 to $925,000.

But REINZ chief executive Colleen Milne warned against concluding the new figures spelled the end to Auckland's super-heated housing boom.

"This is just a flattening out which I don't think anyone is too concerned about and probably due to the low volume of sales in Auckland. It's a normal adjustment from the March high when we had an enormous spike in prices and the highest number of sales since 2007," she said.

Economists also warn the monthly data is prone to seasonal fluctuations, due to more deals in the warmer weather and big jumps in any short period grossly inflating the figures or lower prices pushing down the numbers.

Auckland City and Waitakere's price drop from March to April reflected seasonal variations, Ms Milne said.

The last time the overall Auckland region house prices dropped was in January - from $678,000 in December to $600,000.

Before that, it dropped in June - from $625,000 in May to $600,000.

The last time Auckland stayed frozen in price between months was in the three months of May, June and July in 2012, at $500,000.

"It's much the same reasons, just around which price bracket they're selling and also the volumes," Ms Milne said referring to 1139 Auckland City sales in March falling to 880 last month and 485 Waitakere sales during March falling to only 344 last month.

The number of sales in the Auckland region had plummeted from 3672 in March to only 2759 last month. Compared to April last year, sales volumes last month actually rose 25 per cent. It now takes a median 30 days to sell a house in Auckland once it is listed.

But on an annual basis, the city's dwelling sale price rose 18 per cent or $108,500, from $611,500 last April to $720,000 last month.

In a reflection of how prices in the biggest city are out of step with other areas, the national median price fell 4.2 per cent or $20,000 from March to April to land at $455,000 last month. The volume of sales also fell 17.8 per cent from March to April and REINZ said 7234 dwellings were sold last month.

"Auckland continues to dominate the real estate market in terms of price movements," Ms Milne said.

"The strong price movements in Auckland, particularly on the North Shore and in Rodney, continue to be driven by high demand from all types of property buyers and from a lack of sufficient new supply - both new builds and listings of existing properties," Milne says. "New builds take time to be completed. Meanwhile the very low level of new listings suggests that potential vendors are considering factors other than just price in making the decision whether to sell their properties," she said.

However other areas had seen price rises too, she said, citing Northland, Hawkes Bay and Central Otago Lakes, Waikato/Bay of Plenty, Otago and Taranaki.