The drop in Auckland house prices doesn’t appear to be a one off but more of a growing trend. The Real Estate Institute, has released its figures today showing prices in the country’s largest city have fallen four per cent while sales volumes are down five per cent. Joining Tristram Clayton to discuss what it all means is NZ Herald property editor Anne Gibson.
A change in Auckland's residential property market has now been confirmed by three separate organisations this month.
Yesterday, the Real Estate Institute said Auckland house prices had fallen 4 per cent in the last month and sales volumes were down 5 per cent year on year.
Barfoot & Thompson said this month that the Auckland market had "turned" and there were signs of price rises slowing. The QV House Price Index, also out this month, showed Auckland's 3.7 per cent quarterly value rise the slowest since January last year.
REINZ explained the Auckland changes yesterday.
"Compared to November 2015, sales fell 5 per cent and on a seasonally adjusted basis the number of sales in the Auckland region fell 3 per cent compared to October.
"Compared to November 2015 the median price rose $86,944 (+11 per cent), although it fell by $16,056 (-2 per cent) compared to October 2016. On a seasonally adjusted basis, Auckland's median price fell 4 per cent compared to October," REINZ said.
Bryan Thomson, REINZ spokesman, said the underlying trend was still for prices to rise.
"Auckland prices eased back in November after hitting a record high in October. However, the underlying trend of Auckland prices remains steadily upward, rising by $269,944 at a compound annual growth rate of 13.2 per cent since the introduction of the first set of LVR rules in October 2013," Thomson said this morning.
"First home buyers and investors are staying away from the Auckland market, with numbers down 50 per cent in some parts of the region. As a result inventory levels are continuing to climb. Despite this, the number of sales by auction continues to hold above 40 per cent across the region," he said.
The national median sale price reached a new record of $520,000 and 10 of 12 regions in New Zealand hit new record high median sale prices in November, REINZ said.
Only Auckland and Central Otago Lakes did not post new record median prices.
The number of sales for November 2016 was 7576, up 13 per cent on October. Sales volumes fell 6 per cent compared to November last year. On a seasonally adjusted basis sales for November fell less than 1 per cent, REINZ said.
On Monday, the Herald published its quarterly Property Report, based on QV data. That showed only a handful of suburbs left in Auckland where first home buyers can get Government help for their house purchase.
To get a KiwiSaver first home grant on a property (up to $5000 for an individual or up to $10,000 for two or more buyers), it must be priced under $600,000, up from $550,000 in August.
But the latest QV estimated median values show this increase has done little to make even houses in the cheapest areas within reach of many first home buyers.
The once-affordable West Auckland no longer makes the cut and there are only a few affordable suburbs left in South Auckland.
Three separate organisations have confirmed a change in the Auckland housing market this month. Photo / Richie Robinson
Chief executive of Mangere Budgeting Services Trust Darryl Evans said the dream of owning a home was getting further out of reach for many low-income families.
Homes.co.nz's head of marketing Jeremy O'Hanlon said there was some easing in the Auckland market but there was nothing that would "fundamentally change the disposable income available to those slogging it out saving for a deposit".
He said even in the lower priced area of the Auckland market, first home-buyers were looking at almost double what they would pay for a similar property in Christchurch.
And while the latest TradeMe figures out today indicated growth in Canterbury was sluggish, with only a rise of $3400, 0.7 per cent, to $473,900, elsewhere in the region prices were catching up to the SuperCity.
Last month, three new regions, Waikato, Wellington and Northland, topped the half-million mark in average asking price - joining Auckland, Nelson and the Bay of Plenty.
Head of Property, Nigel Jeffries said Waikato was a "powerhouse region" with prices shooting up $107,700 in the last year to $501,100.
Northland was up 16.4 per cent in the past year to $505,600 and Wellington had grown 10.6 per cent in the same period to $508,850.
TradeMe figures showed the average asking price across the country rose to $624,850, up 1.1 per cent since October and up 9.8 per cent since November 2015.
Auckland: $911,800 up 13.4 per cent in the year to November 2016 Waikato: $501,100 up 27.4 per cent in the year to November 2016 Wellington: $508,850 up 10.6 per cent in the year to November 2016 Canterbury: $473,900 up 0.7 per cent in the year to November 2016
