The tide has turned on the Auckland and Christchurch housing markets, with average dwelling values in the regions now lower than they were 12 months ago.
According to the QV House Price Index the average value of Auckland homes was $1,038,722 in October, down 0.6% compared to October last year.
Of the 19 Auckland sub-districts that the Index measures, average values were down in 10 of them compared to a year ago.
But perhaps more importantly, average values were down in 14 of the 19 sub-districts compared to three months ago (see table below).
This suggests the rising tide of Auckland house values that has been a feature of the Auckland market for several years has now peaked and is starting to turn.
The only sub-districts of the Auckland region where average values are continuing to rise on both an annual and three month basis are the gulf islands (where the market is dominated by Waiheke Island), and Papakura and Franklin on Auckland’s southern rump.
Perhaps significantly, average values were also down compared to three months ago in Kaipara (-3.2%) to the north of Auckland and Hauraki (-2.8%), which is south of the city.
QV Auckland senior consultant James Steele said although there was still strong competition for well presented and located homes, more properties were being marketed with asking prices and potential buyers had more time to carry out building inspections and arrange valuations.
And some developers were having to drop their prices for new homes and sections.
“Some developers who need to sell sections and homes in larger scale, green field developments are having to drop their prices to achieve sales,” he said.
“Examples of this are being seen in Flat Bush where prices for vacant, fully-serviced sections that were selling in the high $700,000s last year are now selling in the in the early $600,000s.
“This drop in land value in the area has also seen sales prices of completed new homes drop back and these new homes are also taking longer to sell,” he said.
The other main centre where housing values are falling is Christchurch, where the average value of $490,429 is down 1.6% compared to a year ago, and average values are down in all sub-districts of the city except Banks Peninsula, where the average value is up 1.6% compared to a year ago.
“There is more than enough supply of new on the market and it’s become harder to find buyers for them,” QV Christchurch senior consultant Daryl Taggart said.
“It’s been quiet with not a lot of activity and we haven’t seen the usual spring upturn in the market as yet,” he said.
Outside of Auckland and Christchurch, average values are continuing to rise, with the QV House Price Index up 3.9% for the whole of NZ compared to a year ago.
However, the rate of growth is slowing and is now the slowest it has been on an annual basis since June 2012.
That suggests average values may be edging closer to their peaks throughout the country.
Although the tide of rising housing values has not yet started to turn in most areas outside of Auckland and Christchurch, it is starting to look like it’s getting near the high water mark.
|QV House Price Index - Three Months to October 2017|
|Territorial authority||Average current value $||12 month change %||3 month change %|
|Main Urban Areas||759,526||1.6%||0.8%|
|Total New Zealand - Nationwide||646,807||3.9%||0.9%|
|Auckland - Rodney||933,909||1.6%||-1.7%|
|Rodney - Hibiscus Coast||913,845||1.9%||-1.5%|
|Rodney - North||954,769||1.5%||-1.8%|
|Auckland - North Shore||1,201,452||-1.6%||-0.1%|
|North Shore - Coastal||1,362,746||-2.0%||-1.3%|
|North Shore - Onewa||981,196||-0.9%||3.0%|
|North Shore - North Harbour||1,168,764||-0.9%||-1.0%|
|Auckland - Waitakere||818,706||-2.2%||-0.1%|
|Auckland - City||1,223,913||1.2%||-0.9%|
|Auckland City - Central||1,079,721||3.8%||-0.3%|
|Auckland_City - East||1,534,549||2.5%||-0.7%|
|Auckland City - South||1,090,843||-2.0%||-1.4%|
|Auckland City - Islands||1,114,609||7.9%||0.8%|
|Auckland - Manukau||893,580||-1.4%||-0.5%|
|Manukau - East||1,151,198||-1.9%||-1.3%|
|Manukau - Central||690,284||-1.2%||0.5%|
|Manukau - North West||764,261||-0.6%||-0.4%|
|Auckland - Papakura||684,268||0.2%||1.3%|
|Auckland - Franklin||665,843||3.8%||1.1%|
|Hamilton - North East||688,533||0.2%||0.9%|
|Hamilton - Central & North West||498,729||-0.3%||-1.0%|
|Hamilton - South East||493,095||0.7%||0.7%|
|Hamilton - South West||483,984||3.5%||0.5%|
|Central Hawkes Bay||284,632||22.3%||-0.6%|
|Wellington - Central & South||728,840||8.2%||0.8%|
|Wellington - East||808,640||12.0%||2.5%|
|Wellington - North||657,822||10.6%||2.2%|
|Wellington - West||863,993||10.0%||3.5%|
|Christchurch - East||369,652||-1.9%||-0.3%|
|Christchurch - Hills||648,850||-4.7%||-2.3%|
|Christchurch - Central & North||578,963||-1.4%||-0.9%|
|Christchurch - Southwest||469,907||-0.2%||-1.0%|
|Christchurch - Banks Peninsula||515,635||1.6%||1.2%|
|Dunedin - Central & North||397,643||12.2%||2.7%|
|Dunedin - Peninsular & Coastal||348,171||14.0%||3.3%|
|Dunedin - South||365,713||11.9%||3.7%|
|Dunedin - Taieri||395,359||11.5%||0.4%|
|Notes on the above data:|
|1. The information included in the above table is based on the monthly property value index. This index is calculated based on the sales data entered into CoreLogic's system in the previous 3 month period. For example, information for the period ending June will be calculated based on sales entered between April 1 and June 30.|
|2. The average current value is the average (mean) value of all developed residential properties in the area based on the latest index. It is not an average or median sales price, as both of those only measure what happens to have sold in the period.|
|3. The percentage change over three months, twelve months and since the 2007 market peak are based on the change in the property value index between that time and the current.|
|4. Any of the statistical data shown in italics are calculated based on a sample set of data that is less than the recommended minimum. These results should be used with caution. Those showing N/A had too few sales to generate an index|