Property prices in New Zealand increased by 1.2% year on year but the national figure is being pulled down by a flat real estate market in Auckland, the latest index shows.
Nationally the annual price rise took median prices to $525,000 but in Auckland they remained flat at $845,000, according to the September house price report from the Real Institute of New Zealand (REINZ).
If Auckland is excluded from the calculation then median prices in the rest of New Zealand increased by 5.7% year on year. However, on a month on month basis median prices in Auckland increased by 1.2% or by $10,000.
Six regions recorded double digit median price increases in September year on year with a rise of 19.3% in Tasman to $572,500, a rise of 18.3% in Hawke’s Bay to $392,000, a rise of 14.9% in Gisborne to $270,000, a rise of 14.4% in Northland to $446,000, a rise of 10.6% in Wellington to $531,000 and a rise of 10% in Southland to $220,000.
The index shows that only two regions experienced price decreases during September on an annual basis with a fall of 15.6% in West Coast to $208,500 and a fall of 3.2% in Canterbury to $426,000.
Bindi Norwell, REINZ chief executive officer, explained that the fact that prices across the country increased in all but three regions is evidence that the market continues to grow despite some challenging conditions, including the LVR restrictions and banks continuing to tighten lending conditions.
She also pointed out that much of the increase has been driven by the buoyancy in the regions but a slow start to the spring market has had an impact on sales with transactions in September down 26.2% year on year, the lowest number of properties sold in the month of September for six years.
Nationally, excluding Auckland, sales fell by 23.7% year on year with all 16 regions in the index recorded a fall in transactions. The biggest fall was 37% in Tasman, followed by a fall of 34% in Southland, a fall of 31.5% in Auckland and a fall of 27.4% in Marlborough.
On a month on month basis the sales outlook is more positive picture with a number of regions recording an increase and two regions experienced double digit growth. Sales were up by 25% in Gisborne and by 11.4% in Taranaki.
The REINZ house price index increased 0.7% month on month to reach an all-time high of 2,699 during September and shows that all regions apart from Auckland, Taranaki and Canterbury reached a new high during September indicating strong value growth across most of the country.
The index also shows that the median number of days to sell a property nationally increased by three days to 34 when compared to September 2016. Regionally, Taranaki saw the biggest increase in the number of days to sell, up eight days to 31, followed by Waikato and Otago, both up five days to 35 and 30 respectively, and Auckland and Canterbury both up three days to 37 and 34 respectively.
Regions with the biggest decreases year on year included the West Coast down 13 days to 105, Gisborne down three to 28 and Hawke’s Bay and Nelson, both down two days to 28 and 23 days respectively. However, the median number of days to sell on a month on month basis, decreased for all regions apart from the West Coast.
The number of properties available for sale nationally decreased by 2.6% year on year but in Auckland the number increased by 14%. Excluding Auckland supply fell by 9.5%, highlighting the impact Auckland has on the overall market.
In addition to Auckland, three other regions experienced an increase in listings with supply in Waikato up 8.2%, in Wellington up 2.8% and an increase of 3.6% in Canterbury. Gisborne had the biggest decrease in inventory with a fall of 29%, while supply was down 24.3% in Taranaki and by 22.7% in Manawatu-Wanganui.
‘Overall, the New Zealand housing market continues to remain in a strong position. While volumes are down, median house prices across the country have increased again. As the weather warms up we expect the market to pick up again,’ Norwell concluded.
