House values soar in tight Auckland property market

Harcourts calculated there was only enough property on hand in its northern region to last 3.5 months. Photo / Thinkstock

Auckland's housing stock shortage continues to cause havoc for prospective buyers, with the latest property figures revealing a sharp jump in prices in the city over the last 12 months.

The Harcourts Northern Region Market Watch compared sales figures from last month and 12 months earlier for Auckland and Northland.

While the number of written sales over the two regions dropped nearly 7 per cent, the average sales price jumped 12 per cent from $619,136 to $696,047.

Harcourts chief executive Hayden Duncan said Auckland's buoyant housing market was the dominant factor behind the sharp increase.

"It continues to be driven by the fact that people need somewhere to live and we've got a population that continues to grow and a housing stock that isn't able to accommodate them," he said.

"There's really nothing that you can do to fix that problem except build houses."

Mr Duncan said sales in all areas of Auckland continued to be strong, unlike the Northland housing market.

"Provincial New Zealand is still very depressed as far as real estate goes. In the Bay of Islands and Whangarei, what most people probably aren't aware of is that those markets haven't actually recovered since the global financial crisis."

Sale numbers in Northland remained low, Mr Duncan said.

Harcourts calculated there was only enough property on hand in its northern region to last 3.5 months.

"This statistic highlights how limited the pool of housing is, with well-priced properties sold quickly," the agency said.

Fast-tracking construction of good houses to keep up with Auckland's growing population would help ease high demand for homes in the city, Mr Duncan said.

"We also remain on the side of first home buyers, who need more choice and the removal of LVR restrictions to help them achieve the Kiwi dream of home ownership," he said.

Mark Smith, ANZ senior economist, said in the bank's latest market focus that Real Estate Institute figures due out this week would also show volume changes.

"We are likely to see a May bounce in sales volumes," he said, predicting a 7 per cent seasonally adjusted month-on-month change "but this would still leave volumes down more than 10 per cent on a year ago."