New Zealand property growth slowed once again in March, with 12.6 percent annual growth in January dropping to 11.6 percent in February and 11.4 percent last month. While home values were still up across much of the country, increased regulation has helped to slow growth in Auckland since the start of the year. Despite slowing conditions, however, recent weeks have seen renewed activity in some quarters, with increasing sales volumes, ongoing supply shortages, and population growth in Auckland pointing towards another upwards swing.
According to Quotable Value spokesperson Andrea Rush, "Home values have risen in most parts of New Zealand in the first quarter of 2016 with the exception of the Auckland region where values have been on a slight downward trend over the past three months... However, over the past few weeks activity and demand have begun to pick up again across the 'super city' and values have actually risen again over the past month by 0.6 percent, so it appears the downward trend may be coming to an end.”
The average house price in New Zealand currently sits at $559,492, with values up 0.2 percent over the quarter and 11.4 percent over the year. While property values in Auckland dropped 0.2 percent over the quarter, they still managed to rise by 16.9 percent over the year to reach $931,061. An average home in Wellington costs $491,236, with prices up 3.1 percent for the quarter and 7.5 percent for the year. Napier experienced a healthy increase of 4.3 percent for the quarter and 9.1 percent for the year to $358,732, with Hamilton values rising by 3.7 percent and 23.3 percent respectively to reach $460,725.
Values in Hastings rose by 2.6 percent for the quarter and 9.6 percent for the year to reach $331,149, with Christchurch City rising by 0.8 percent and 2.9 percent to $485,700, Dunedin increasing by 2.0 percent and 8.1 percent to $315,185, and Nelson rising by 4.3 percent and 8.9 percent to $446,860. Despite the marked slowdown in Auckland, a number of provincial centres experienced the fastest rate of home value growth since the previous peak of 2007 - including Whangarei, Napier, Rotorua, Taupo, Central Otago, and Queenstown Lakes Districts.
“Regional areas within commuting distance to Auckland, Tauranga and Hamilton also continued to show significant value rises including towns located in the Waikato, Waipa, Hauraki, Western Bay of Plenty and Kaipara Districts,” said Rush, adding “The only areas to see a drop in home values over the first quarter of the year in the North Island apart from parts of Auckland were Otorohanga, Wairoa, South Taranaki and in the South Island, the West Coast districts of Buller and Westland as well as Ashburton and the Christchurch Hills suburbs.”
Despite dropping values in Auckland over the quarter, sales volumes have risen by an astonishing 67 percent from February to March. According to Real Estate Institute of New Zealand (REINZ) chief executive Colleen Milne, predictions of a market slowdown are overstated: "Recent fears of the Auckland market cooling have been overstated, as median prices across the city have rebounded during March... The slowdown in sales volumes after the introduction of tax and LVR changes last year appears to be coming to an end with a significant lift in sales for March and a further uplift in the median price."
Image source: ConstantinosZ / shutterstock.com