Auckland property hits doldrum

 

Values flat, declining, marginally up

 

By: Anne Gibson

Property editor, NZ Herald

anne.gibson@nzherald.co.nz @anneherald

 

Autumn and early winter Auckland property values have stayed on ice, showing a longer-term pattern of being frozen or flat.

The city's once-superheated property market, which in 2015 was rising at more than 24 per cent, has cooled to the point where in the three months to June, values fell in dozens of suburbs.

The QV Value Index out today showed Papakura values fell 1.8 per cent, Waitakere 0.6 per cent, Manukau northwest, Franklin 0.1 per cent, Auckland City east and Auckland City south fell 0.5 per cent.

Auckland east is St Johns, Meadowbank, Glen Innes, Pt England, Orakei, Kohimarama, Mission Bay, Ellerslie, St Heliers and Greenlane.

Auckland city south is Blockhouse Bay, One Tree Hill, Sandringham, Mt Albert, Wesley, Three Kings, Mt Roskill, Otahuhu, Onehunga, Mt Wellington and Avondale.

North Shore values rose only 0.2 per cent overall in the three months, Rodney 1.6 per cent and Manukau values had no change.

Overall, New Zealand values rose 1.2 per cent to reach an average $639,051, up 1.2 per cent in the past three months, 8.1 per cent in the past year and 54.2 per cent since the previous peak in 2007.

Auckland property values average $1,045,059, up 2.4 per cent in the past three months, 7 per cent in the past year and 91.2 per cent since the 2007 peak.

QV national spokesperson Andrea Rush said: "Values in the Auckland market continue to hold steady with the average value across the region remaining at just over $1 million.

"However, sales volumes in the Super City have plummeted to 30 per cent lower than they were this time last year as high prices coupled with banks' stricter lending criteria are making it increasingly difficult for anyone but cash buyers or those with higher levels of equity to buy property.

"It has also become much more difficult for developers to gain finance to build new homes, which is now leading to a slow-down in building activity in the market," Rush said.

Hamilton values rose 1.2 per cent in the three months to an average $539,357, Tauranga values rose 1.6 per cent to $687,364, New Plymouth rose 8.7 per cent in the three months to $423,157, Wellington rose 2.4 per cent to $609,552 and Christchurch was up 1.1 per cent to $496,378.

QV homevalue Hamilton valuer, Stephen Hare said: "Values in the Hamilton city market have plateaued over the past month. Sales volumes have picked up recently, however the average time on the market for a residential property has lengthened and this is giving buyers more opportunity to negotiate on price and conditions of purchase."

QV homevalue Tauranga, registered valuer David Hume said: "Demand for Mt Maunganui properties remains strong and record prices continue to be achieved.

Desirable suburbs around Tauranga such as Matua, Bethlehem and the Avenues are also continuing to see strong levels of demand and record prices being achieved for well-located and presented properties."

Of the national picture, QV said values were generally remaining steady but sales volumes were dropping because banks were tightening their lending criteria.

"The latest monthly QV House Price Index shows nationwide residential property values for June increased 8.1 per cent over the past year, which is the slowest annual rate since March 2015. Values rose by 1.2 per cent over the past three months and the nationwide average value is now $639,051, which is 54.2 per cent above the previous market peak of late 2007. When adjusted for inflation the nationwide annual increase drops slightly to 5.9 per cent and values are now 28.8 per cent above the 2007 peak," QV said.

Barfoot & Thompson, with about 40 per cent of the Auckland market, will release their data today and the Real Estate Institute figures for June will be out around the middle of this month.