Auckland house price growth slowing, latest data shows
Auckland house prices continued to rise in August but there are signs that the rate of increase is slowing, which first showed up in July, are continuing.
The average price of a home increased 4.5% in August month on month to $906,560 but up just 2.6% over the previous three months, according to the latest index data from Barfoot & Thompson.
Manging director Peter Thompson said that August’s price increase was restrained, for both the average price and the median price and while the slowdown is not so obvious when comparing August data with that for July, but when you look at the average for the previous three months it becomes more apparent.
‘Our data shows that those claiming the average price is on the verge of topping $1 million are over inflating where prices are heading. While prices continue to rise, for the past five months buyers have not been prepared to pay more than they believe is the market price,’ he explained.
He pointed out that the same trend can be seen with the median price, which at $850,000 for August is up 1.2% month on month and up 2.5% for the average for the previous three months.
‘Current price increases are relatively modest compared with what has occurred in recent years. The slowdown can also be seen when comparing August’s sales numbers, listings at month end and new listings with the average for these statistics for the previous three months,’ Thompson added.
The data also shows that sales are slowing. Transaction numbers were down 9.2% while supply increased by 6% although new listings remained at the same level.
‘It has led to a small increase in the choice available for buyers. It all adds up to some heat coming out of the market,’ said Thompson.
He believes that the continued rise in prices with lower sales indicates that new regulations requiring investors to have greater equity than previously, which the trading banks enforced at the start of August, has had a limited impact on prices but may have affected sales numbers.
Overall sales were down 3% month on month and were 25.5% lower than in August last year. New listings were up 19.6% on those for July but 4% lower than in August last year.
Available properties at month end at 3,151 were at their highest for five months and up 4% on those at the end of July and up 6.6% on those for the same month last year.
‘The real test of where prices are heading will come this month with the arrival of spring. For the past three years September’s average and median prices have exceeded those for August, with prices then continuing to increase to year end,’ Thompson added.
During August, 347 properties, representing 34.6% of properties sold for in excess of $1 million and 109 properties, representing 10.9% of all sales, sold for under $500,000.