Average property values rocketed up in Wellington over the last 12 months, headed sideways in Auckland and took a dip in Christchurch

Average residential property values in the Auckland Region have risen just 0.7% over the last 12 months while average values in the Wellington region are up 9% and in Christchurch they have dropped 0.6%, according to Quotable Value's latest valuations.

Values have also risen only modestly in Hamilton, (+2.6%) and Tauranga (+3.9%) over the last 12 months but are up more strongly in most other provincial centres.

Major centres posting double digit annual increases in average property values include Whangarei +10%, Napier +15.4%, Hastings +15.7%, and Masterton +18.6%. (See the table below for all districts).

Within the Auckland region, there have been strong increases in average values in Kaipara +9.2% and the Gulf Islands +12.6%, while most other parts of Auckland recorded annual increases of between 0.3% in Manukau and 2.9% in Central Auckland's eastern suburbs.

Average values declined in Waitakere -1.6%, the southern suburbs of Central Auckland -0.3% and north west Manukau -0.6%, compared to a year ago.

"The signs do suggest that the heat has been taken out of the market and buyers are showing less urgency," QV's Auckland Property Consultant William Liew said.

That contrasts with the Wellington market where average values have risen strongly in the last 12 months.

The biggest annual incarese was in Porirua +13.4% followed by Kapiti Coast +12.9%, while average values in the Hutt Valley were around 8.5% and in Wellington City values increased by between 8.1% and 9.3% over the year.

"A lack of housing supply, coupled with a recent increase in population, continues put upward pressure on values," QV Wellington Senior Consultant David Cornford said.

"This tight supply is creating strong demand for vacant land a new builds, particularly in the outer Wellington regions including Churton Park, Grenada and Aotea."

In Christchurch values have been lacklustre, posting an overall decline of -0.6% over the last 12 months.

Average valuations were down compared to a year ago in four of the city's six districts and up less than 0.3% in the other two.

"A high supply of housing stock and a lack of demand are driving low value growth," QV Christchurch Senior Consultant Daryl Taggart said.

    QV House Price Index - Three Months to January 2018

Territorial authority Average current value 12 month change% 3 month change %
Auckland Region            1,054,974 0.7% 1.6%
Wellington Region               634,811 9.0% 4.0%
Main Urban Areas               787,740 4.4% 3.7%
All New Zealand                671,531 6.4% 3.8%
       
Far North 421,197 8.1% -0.1%
Whangarei 509,857 10.0% 2.9%
Kaipara 506,745 9.2% 0.3%
Auckland - Rodney 947,856 1.5% 1.5%
Rodney - Hibiscus Coast 927,897 2.1% 1.5%
Rodney - North 969,140 0.8% 1.5%
Auckland - North Shore 1,228,920 1.2% 2.3%
North Shore - Coastal 1,410,765 1.7% 3.5%
North Shore - Onewa 977,381 0.6% -0.4%
North Shore - North Harbour 1,199,720 0.8% 2.6%
Auckland - Waitakere 822,871 -1.6% 0.5%
Auckland - City 1,245,682 1.7% 1.8%
Auckland City - Central 1,078,359 1.2% -0.1%
Auckland_City - East 1,576,640 2.9% 2.7%
Auckland City - South 1,104,859 -0.3% 1.3%
Auckland City - Islands 1,166,941 12.6% 4.7%
Auckland - Manukau 904,158 0.3% 1.2%
Manukau - East 1,161,381 0.3% 0.9%
Manukau - Central 703,189 2.4% 1.9%
Manukau - North West 776,208 -0.6% 1.6%
Auckland - Papakura 700,283 2.4% 2.3%
Auckland - Franklin 673,514 2.0% 1.2%
Thames Coromandel 704,581 9.1% -3.9%
Hauraki 373,471 3.9% -3.1%
Waikato 470,218 6.5% 2.8%
Matamata Piako 432,464 8.5% 1.0%
Hamilton 544,935 2.6% 0.3%
Hamilton - North East 692,145 2.0% 0.5%
Hamilton - Central & North West 494,164 0.9% -0.9%
Hamilton - South East 494,488 2.5% 0.3%
Hamilton - South West 492,551 5.6% 1.8%
Waipa 530,898 8.2% -0.7%
Otorohanga 293,089 20.1% -3.7%
South Waikato 225,800 19.6% 6.2%
Waitomo 204,268 18.5% 4.0%
Taupo 467,505 11.8% 4.5%
Western BOP 617,120 7.3% -1.7%
Tauranga 698,875 3.9% 1.7%
Rotorua 417,258 9.8% 3.2%
Whakatane 411,370 8.1% 0.3%
Kawerau 187,011 5.5% -1.3%
Opotiki 302,220 21.7% 11.4%
Gisborne 296,435 9.1% 0.9%
Wairoa N/A       N/A N/A
Hastings 453,616 15.7% 3.9%
Napier 483,759 15.4% 3.5%
Central Hawkes Bay 307,507 21.2% 8.0%
New Plymouth 439,011 5.6% 2.1%
Stratford 251,136 7.2% -2.6%
South Taranaki 209,745 5.4% -0.4%
Ruapehu 174,029 10.9% 0.8%
Whanganui 238,248 14.7% 4.4%
Rangitikei 195,601 19.9% 4.8%
Manawatu 326,418 12.8% 2.0%
Palmerston North 379,248 8.8% 2.5%
Tararua 183,896 12.2% 1.3%
Horowhenua 300,771 16.6% 3.7%
Kapiti Coast 544,874 12.9% 3.2%
Porirua 548,889 13.4% 4.0%
Upper Hutt 470,511 8.5% 1.1%
Hutt 523,344 8.4% 0.6%
Wellington 764,560 8.9% 3.5%
Wellington - Central & South 768,645 9.3% 5.5%
Wellington - East 821,254 9.0% 1.6%
Wellington - North 684,884 9.1% 4.1%
Wellington - West 874,198 8.1% 1.2%
Masterton 327,415 18.6% 2.1%
Carterton 366,143 13.9% 4.3%
South Wairarapa 457,934 23.5% 2.3%
Tasman 560,907 12.6% 2.6%
Nelson 558,587 9.9% 1.3%
Marlborough 453,173 6.9% 3.5%
Kaikoura N/A N/A N/A
Buller 187,595 2.2% 0.9%
Grey 214,972 1.5% 7.3%
Westland 240,885 2.8% -2.5%
Hurunui 381,419 0.8% 0.5%
Waimakariri 437,733 0.7% 0.0%
Christchurch 494,459 -0.6% 0.8%
Christchurch - East 372,005 0.2% 0.6%
Christchurch - Hills 667,870 0.1% 2.9%
Christchurch - Central & North 584,136 -0.8% 0.9%
Christchurch - Southwest 471,587 -1.2% 0.4%
Christchurch - Banks Peninsula 510,268 -0.8% -1.0%
Selwyn 546,340 -0.1% 0.5%
Ashburton 350,514 0.5% 1.3%
Timaru 354,254 5.6% 0.3%
MacKenzie 534,982 27.1% 10.3%
Waimate 227,424 -0.7% 1.7%
Waitaki 297,755 14.3% 4.8%
Central Otago 471,455 14.7% 0.3%
Queenstown Lakes 1,116,673 8.1% 2.2%
Dunedin 392,512 9.3% 2.6%
Dunedin - Central & North 410,278 10.2% 3.2%
Dunedin - Peninsular & Coastal 360,397 12.6% 3.5%
Dunedin - South 373,189 9.1% 2.0%
Dunedin - Taieri 402,502 7.1% 1.8%
Clutha 209,395 10.1% 4.1%
Southland 272,221 15.1% 5.0%
Gore 219,810 9.5% 1.3%
Invercargill 255,045 6.6% 2.9%

 

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57 Comments

So a 450k house (12 months ago) in Hastings is now $518k?

How on earth houses are worth that much in Hastings is beyond amazement.

I know. Hastings includes the genteel suburb of Havelock North which may partially explain the apparently flourishing average price.

In Trademe, Havelock North is a subset of Hastings. Maybe that’s why.

A similar argument could be made about A LOT of *very* average suburbs in Auckland (as well as much of the country, for that matter). At least in Hastings they get arguably the best weather in the North Island, no traffic jams and you're never more than a 10-minute drive from anywhere.

But you would have to factor in the cost of buying some grunty padlocks to lock everything down..

Looks to me like the table above says Hastings current value is $453,616

That's approximately $450,000 more than I would pay to live there.

up
10

Confirmation that the Auckland market has stalled.

The rising inventories and low sales shows that there is very weak demand at these prices, so what will happen from here...... lots of changes on the horizon that are likely to weaken the market

No surprise to see Waitakere heading south

Yes Waitakere is popular with Europeans who are much more savvy on negoiting prices down and less likely to throw their money about. Interesting to see that prices are still rising a bit in Central Eastern Auckland which is very popular with the Asian market. I'm sure there was many a RE rubbing their greedy hands with glee at the news of China relaxing it capital outflows regulations yesterday.

So that foreign buyers ban, when is that coming in to effect Greg?

Surely if you don't have $2.5M you can't buy into DGZ? One of the nearby ghost houses on my list is now in the market with the subject line:
"Single Level Sun Trap in Double Grammar"
https://www.trademe.co.nz/property/residential-property-for-sale/auction...

to be presented to parliament on 20th feb and discussed hence forth, with the intention to be done before march 8th

typical syndrome of a combination of incompetent government, short-sighted local council, capitalism-spirited suppliers and developers, and a service-based economy that relies heavily on foreign consumers.

Hmm, a fairly accurate description of society in general. The will of the people.

Solid increases in Wellington property values will underpin increases in Auckland values.

TTP

Not sure of your logic there. Wellington prices have taken a jump. They are at the point where more supply is attracted to the market and will not grow too much higher. Auckland is likely to decline. I will confess that the Auckland market has been more resilient than I might have picked - but can't see how Wellington would impact it.

I don't think the Wellington market leads the Auckland market TTP, it's the other way around

Inflation adjusted decreases in Auckland property values will put a stop to Wellington value increase.

Look, I can post statements without any evidence too.

edit: spelling

TTP a grand design turret house for you and family, right across the road from Mike Hosking! https://www.barfoot.co.nz/604877#Video

Looked a reasonable lifestyle until that last major negative. The Hosking factor must knock $500k off the price, surely. No one enjoys noise pollution.

a statement without much thought

Wellington market was flat and unexciting for the best part of a decade. When markets are static they often react with a rapid growth period that returns the values to the historical growth curve. I don't see the recent Wellington growth as particularly exciting, concerning or OTT. It was flat values for yonks followed by catch up growth, maybe with the additional pressure of some specuvestors chasing CG in Welly, finding it easier to buy with the LVR and seeing more opportunity for nearer term uptick in values in Wellington than Auckland, (which has obviously peaked).

Wellington was very late to join the property boom, and if Auckland shows price declines, I think it's more likely that everywhere else will follow Auckland down, not necessarily with big prices declines, some will plateau for yonks again. Auckland has been in a bubble, and more likely to correct but i'm not sure other regions have bubbled to anywhere near the same extent.

No logic but much wishful thinking.

not good signs for leveraged investors counting on CG, i have read online of the banks tightening loan criteria on existing loans, and investors having to go to 2nd tier lenders

Could you send a link to where you read that sharetrader?

go to interest rates or BNZ lending on propertytalk.com NZ
you will see a note with how the banks have increased the calculation to 6.09%,
as well as many saying they are having trouble with refinancing and the treatment for investors has changed in banks minds

The calculation number being above 6% is reasonable. It wasn't that long ago that rates around 6% or more were typical for 80% LVR. It's a possible scenario that could happen again.

There are banks using AIR numbers as high as 7.8% but that's been the case for over a year so its hardly news but it is prudent as you point out.

Will be interesting to see the decline in Auckland and then whether there’ll be a precipitous decline in the regions. Pending regulatory change it might be that, unlike other larger cities elsewhere in the world, Auckland might equally lag with the provinces in recovery.

Greg , as usual, doesn't like to be the bearer of bad news .... Bellow is the same News and detailed analysis of this announcement ....Perfect reflection of the market status and correct analysis and explanation of why things are what they are now and where they could possibly be heading .. ( proper news reporting as it should be)

http://www.sharechat.co.nz/article/6ee0826b/nz-property-value-gains-slow...

It's good to see that higher value Auckland suburbs are rising by 1.5 to 2.3% (is that what you call sidewise ??)

Looks like that 100,000 drop in Auckland prices was a rumour after all !! ---

In anticipation of the Crash .... Expect an Auckland average price rise of 2 - 5% in 2018, maybe more in some prominent suburbs and streets ...

Even if there is a stock market crash and recession?

Investors in general are a far safer risk to Banks than owner/occupiers.
Investors can always sell their property and theres always enough margin in it for the Banks
Owner occupiers however can always lose their income or job and be forced to sell if they are unemployed
The investor is always able to achieve income from rent!

I can assure you that the "Banks" don't agree with your statement. Owner/Occupiers are always treated more favourably when risk is factored into the equation.

Investors in general are a far safer risk to Banks than owner/occupiers.
Investors can always sell their property and theres always enough margin in it for the Banks
Owner occupiers however can always lose their income or job and be forced to sell if they are unemployed
The investor is always able to achieve income from rent!

Umm are you sure investors can always sell their property?....good luck selling if/when the tide is going out there TM2...

Funny that owner occupiers can lose their income or jobs but your tenants won't right? Oh but of course, the government will come to their aid and pay accommodation supplements to keep you above water....

Of course investors are a far safer bet.
There is more margin of security in an investment property than an owner occupier
If a tenant loses his job the landlord can always get in another tenant that pays.
We have never once lost money from a non paying tenant as we always do our homework and there is always 4 weeks bond paid up.

Have you ever been a landlord in a country experiencing a significant recession and people are losing jobs/wages? But I'm sure your margins are excellent and it won't be a problem.

Fascinated to see the analysis on this - in the UK the accepted wisdom is that investors are higher risk and are charged a higher interest rate to account for this. Easier to run away from an investment than your own house, presumably. Also interest only loans are more common among investors which increases the risk as principle isn't eroded away over time.

No point educating the doomsters MAN 2, they get shocked everytime there is an update on prices and try to change the narrative ...simply because they get numbed by any negative piece of news about inventory and auction clearance rates etc ... some even seriously think that they are still living in the UK, and their rules should apply here ... lol

Hence today's news is a blow to the face as we learn that anyone who bought in Wellington a year ago would have now been about 9% better off - H/bay ...15% better off ... anyone procrastinating and following silly advice waiting for a crash now has another 2 years of more saving to catch the boat ....

If the Gov goes on in forcing more landlords out of the market, then they will have a much bigger problem on their hands as the report correctly spotted.

the next two months will be tougher.

Eco Bird, the Government is not forcing Landlords from the market, the absence of quick capital gains is. Professional Landlords already met the new requirements so few surprises there.

What's rattling your cage?

I'd have assumed the relative risk of owner occupier vs. investor would be the same in such similar countries as the UK and NZ - I'm waiting to be educated on what the difference is. Unsupported statements do not pass for education I'm afraid.

Also worth pointing out that anyone forgoing a property purchase and investing in the share market instead would be looking at ~20% returns over the last year without any upkeep or maintenance required, while an average house in Auckland or Christchurch would have reduced in value after adjusting for inflation.

I like being educated Eco Bird but not when the "education" is generalised, unfounded claims from the likes of TM2.

THE MAN 2, that's just BS and you know it. Rhetorical question. Are you any wiser than when you lost out in the 87 share crash?

Oh okay then, I'll give you a clue. The one word answer starts with the letter "N"

I suggest you practice writing your Bovine Scatology thesis on another forum - lol!

It's classic reading the posts because it gives a fair indication that our property market may not be built on bricks and mortar (from a financial stability point of view...). Those doing the 'investing' have no idea what they're doing and yet there are many of them and they all 'know exactly what they are doing' - experts...

funny banks are not classing investors as the lessor risk hence the tightening of credit on them as of late, not to mention the RBNZ always classes them as higher risk to the banking system hence the higher LVR's.
but dont let your one eye get in the way of a good fairytale
also waiting on TM2 to discredit the figures and say Christchurch property prices are increasing above average for NZ
need a good laugh today

Here's a view from a Nobel Prize winner in Economics for the property bulls/bears: 'Shiller warns that higher interest rates can tip the housing market'. So the inflation question becomes quite interesting....

http://www.foxbusiness.com/markets/2018/02/08/higher-interest-rates-can-...

The mere whiff of inflation and higher borrowing costs are sending equities lower. If it becomes a complete crash, I suggest inflation won't be the problem. In fact quite the opposite. The bigger problem is Central Banks inability to fight a deflationary scenario.

Jim Rogers put it this way; https://www.bloomberg.com/news/articles/2018-02-09/jim-rogers-says-next-...

So a house in CHristchurch (where prices are VERY affordable) have fallen, whilst prices in Orckland where prices are UNaffordable have fallen.
Now you can call that efficient markets in action, OR you can question the definition of afordable. After all supply and demand is what defines prices, and if people demand to live in Orcs after selling their liquifactioned home in Chch, who an I to argue with the free market¿

Personally don’t care about prices as we don’t sell and better bargains are still to be found.
Don’t personally beleive that prices as such have dropped,on average,
Bear in mind the as is where is properties are still,selling big time in Chch and most of them there is bugger all,wrong with them.

You've been pitching this 'as is where is properties dragging down average prices' thing for a while now. The only way this could drag the average down on an annual basis is if the proportion of sales which are 'as is where is' were increasing. I'd have thought the opposite were true as old damaged stock is systematically cleared, upgraded or replaced. Interested to know why you think differently.

MFD, what I am saying is that the multitude of As is where is property falsifies what the median or average price for a house is in Ch.Ch that is sold with insurance immediately available.
People have done very well out of the Chch quakes as they have received large payouts and they are left with the damaged house which they sell, and that is just a bonus so they don’t really care what that sells for!!

No you are wrong TM2. If my neighbour is selling his average $2.5M house for $1M I'd expect the queue to reach Chch. Prices do matter!!

Lets hope the incoming minimum rentals standards agree with you.

The media along with your neighbours would beg to differ. Alot of properties in Christchurch are years away from being repaired, let alone being settled by EQC. People are too scared to buy properties in Christchurch after hearing all of the horror stories going on.

You are wrong that people are scared to buy property in Chch.
The thing that has slowed the market in NZ is not demand but the LVR changed that the RBNZ brought in.
Personally like flat prices as it is better for everyone except the speculators.
Investors actually do far better when prices are flat as the opportunities are greater!

Palmy is tipping already. 50K shaved off the asking price next door in the past 6 weeks. However, the sellers had a junk shed that was erected without council consent and it came back to bite them. It worked in favour for the new home buyer. They reduced their offer and ripped out the junk shed within 2 weeks of moving in. I could not have been happier with that result.

Double-Gz, think you don’t understand the CHCh situation.
A ChCh house pre earthquake may have been worth say 400k.
After the quakes the owner may have been paid out say 500k to rebuild the house under replacement insurance.
The owners got to keep the house and then they auction it off or sell it and they get say 200k so they are
300k better off than before the quakes.
It has given them Plenty to build a far better home in a far better location!