Archive | Quotable Value

Auckland house price index at standstill, still rising nationally

Quotable Value Ltd’s house price index for Auckland was at a standstill for the 3 months to June, after coming in at a 0.1% rise over the 3 months to May and a 0.4% dip in the 3 months to April.

Over the whole country, the index is in a state of flux – up in one area, down in a neighbour.

The various indexes for Auckland & its components – local government areas on the pre-2010 boundaries and broad splits within them – showed 11 falls in the total 20 areas (which include double-ups) in the April quarter, dropping to 8 falls in the roll to May and down to 7 in the roll to June.

For the year to June, the Auckland index is showing a 7.2% gain, the slowest since September 2012. That 2011-12 period was the start of the break out from the 2011 bottom of the global financial crisis for New Zealand, and property inflation in Auckland sped up through to last year, until Reserve Bank measures, reduced Asian investment and now bank lending restrictions slowed the rise. Adjusted for inflation, QV’s index for Auckland rose 4.9% in the last year, 28.8% since the previous market peak at the end of 2007.

Nationally, the index rose 8.1% over the last year, the slowest rate since March 2015, and 1.2% over the last 3 months. Adjusted for inflation, the annual increase dropped to 5.9% and the rise since 2007 to 28.8%.

QV view

QV national spokesperson Andrea Rush said Auckland sales volumes had plummeted 30% below the number a year ago “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 slowdown in building activity in the market.

“The CoreLogic Buyer classification data shows the share of sales to all buyers requiring a mortgage has dropped and the share of sales to cash buyers remains steady.

Around the country

“Meanwhile, in the other main centres, values are now rising again in Hamilton & Tauranga after decreasing earlier in the year. A slowdown in value growth in the Wellington market is now more evident in the QV house price index data and Porirua, a previous hot spot, has seen values decrease over the past quarter.

“The Christchurch market is flat, with some areas seeing a slight decrease in values over the past quarter, while values continue to rise in a relatively buoyant Dunedin market.”

“Values in regional centres such as the Kaipara district north of Auckland, Hawke’s Bay, Nelson & the Tasman district are now seeing stronger value growth than the main centres as buyers look to the regions in search of more affordable homes.”

Auckland detail

Ms Rush said values around the Auckland region continued to plateau, and values remaining steady over at 0.0% change over the last 3 months: “Values have continued to rise in some parts of the Auckland region but have decreased in others. Auckland City–Islands rose the most over the past quarter, with values rising 3.1% since April and 13.3% year on year. Rodney North also continued to increase more quickly than other parts of the city, up 2.2% over the past 3 months and 13.6% year on year. Values decreased in the Auckland City apartment market and also Auckland City east & south; as well as in Waitakere, Manukau north-west, Papakura & Franklin over the past 3 months.”

QV’s index figures around Auckland on the old council boundaries, and for the Auckland region, and around the country below that (old councils & main areas in bold; 2 areas, Kaipara & Auckland’s gulf islands, carry a warning for their low transaction levels).

The dollar figure is the average value for June. The first percentage is for the 3 months to June, the second is for the last 12 months and the third is the change since the 2007 peak:

Auckland region, $1,045,059, 0.0%, 7.2%, 91.2%
Rodney, $955,814, 1.6%, 11.9%, 63.0%
North, $984,933, 2.2%, 13.6%, 64.0%
Hibiscus Coast, $928,686, 0.9%, 10.2%, 58.1%
North Shore, $1,203,775, 0.2%, 6.0%, 86.5%
Coastal, $1,376,695, 0.1%, 6.2%, 82.7%
Onewa, $956,862, 0.4%, 4.8%, 92.9%
North Harbour, $1,190,626, 0.5%, 7.5%, 95.9%
Waitakere, $823,630, -0.6%, 6.8%, 94.2%
Auckland City, $1,228,005, -0.1%, 7.1%, 97.3%
Central, $1,073,116, 1.0%, 7.8%, 88.4%
East, $1,534,921, -0.5%, 7.1%, 92.6%
South, $1,103,498, 6.1%, -0.5%, 105.0%
Hauraki Gulf islands, $1,099,383, 3.1%, 13.3%, 72.0%
Manukau, $900,766, 0.0%, 7.0%, 96.8%
East, $1,169,679, 0.3%, 8.0%, 96.2%
Central, $684,184, 0.4%, 5.3%, 82.0%
North-west, $771,795, -0.5%, 6.6%, 108.9%
Papakura, $677,340, -1.8%, 8.1%, 88.3%
Franklin, $666,845, -0.1%, 9.0%, 68.6%

Northern border, down country & national:

Whangarei, $492,588, 4.3%, 19.6%, 24.3%
Kaipara, $520,852, 10.5%, 24.3%, 31.3%
Hamilton, $539,357, 1.2%, 9.5%, 49.2%
Tauranga, $687,364, 1.6%, 14.6%, 42.8%
Wellington region, $609,552, 2.4%, 18.0%, 33.8%
Christchurch, $496,378, -0.1%, 1.1%, 30.8%
Queenstown-Lakes, $1,071,995, 2.9%, 19.2%, 55.9%
Invercargill, $241,770, 1.9%, 9.2%, 9.6%
Total NZ, $639,051, 1.2%, 8.1%, 54.2%

Link:
Full index:  QV house price index for June 2017

Attribution: QV statistics & release.

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Small housing index lift in Auckland – Kaipara & Opotiki now the leaders

Quotable Value Ltd’s index for the Auckland region rose 0.1% in the 3 months to May after dipping by 0.4% in the 3 months to April.

Nationally, the index rose from no change to April, to a 0.4% gain to May.

QV national spokeswoman Andrea Rush said in the organisation’s monthly release, out today, the 9.7% index rise nationally for the last 12 months was the slowest annual rate in 2 years. In Auckland, the annual rate dropped from 10.7% at April to 9.3% at May.

The big hitters now are Kaipara, up 9.2% for the last 3 months and up 25.1% for 12 months but up only 29.6% since the previous peak at the end of 2007, and the one place showing double-digit growth in the last 3 months, Opotiki. The index there rose 12.9% over 3 months (like the Kaipara, on low volume), and 22.5% over the year, but is up only 0.8% since 2007.

The index for Auckland overall and for many of the hot spots have been easing for months, but the latest figures show a few places have risen again. QV shows 20 Auckland areas (the region, the old council areas and some of those areas broken down) in its presentation of the indexes nationally, and 11 of those 20 areas were negative for the 3 months to April.

For the 3 months to May, however, the negatives fell to 8, starting with a turnaround for the whole region. The North Shore & 2 of its components, the coastal area & North Harbour, turned positive while Papakura turned negative.

These index measures aren’t adjusted for inflation, but QV issues an inflation-adjusted version for its national index and for Auckland. Nationally, the 12-month rise was 7.4% adjusted for inflation, and 27.8% since 2007. In Auckland, the 12-month rise was 7.0%, 44.0% since the 2007 peak.

The QV picture

QV’s indexes around the country for the last 12 months.

Ms Rush said: “Nationwide value growth continues to ease back due to lower demand in the housing market caused by the latest round of LVR restrictions and tougher lending criteria from the banks as we head into the winter period.

“Sales volumes are lower than they were this time last year, particularly in Auckland, and it’s possible market activity may now remain more subdued until after the election.

“Value growth continues to be stronger in Wellington & Dunedin than in the other main centres but is also starting to ease back a little.

“With Auckland & Hamilton only seeing very slight value growth over the past 3 months and values dropping slightly in Christchurch, these markets are relatively flat by comparison.

“Values in Tauranga are showing stronger quarterly growth than last month, but across the board it appears much of the frenzy has come out of the housing market there and have returned to more normal levels of activity & demand.”

QV’s index figures around Auckland on the old council boundaries, and for the Auckland region, and around the country below that (old councils & main areas in bold). The dollar figure is the average value for May. The first percentage is for the 3 months to May, the second is for the last 12 months and the third is the change since the 2007 peak:

Auckland region, $1,044,561, 0.1%, 9.3%, 91.1%
Rodney, $960,087, 2.5%, 13.1%, 63.7%
North, $994,136, 3.9%, 15.5%, 58.4%
Hibiscus Coast, $930,274, 1.3%, 10.9%, 65.5%
North Shore, $1,198,381, 0.1%, 7.9%, 85.7%
Coastal, $1,369,770, 0.5%, 8.0%, 81.8%
Onewa, $953,727, -1.0%, 7.4%, 92.3%
North Harbour, $1,184,048, 0.7%, 8.6%, 94.9%
Waitakere, $825,736, -0.7%, 7.9%, 94.7%
Auckland City, $1,222,137, -0.7%, 7.9%, 96.3%
Central, $1,075,398, 1.2%, 9.5%, 88.8%
East, $1,524,074, -1.1%, 8,8%, 91.2%
South, $1,096,186, -0.4%, 8.3%, 103.6%
Hauraki Gulf islands, $1,074,011, 1.6%, 15.1%, 68.0%
Manukau, $902,068, 0.0%, 9.4%, 97.1%
East, $1,168,644, 0.8%, 10.8%, 96.1%
Central, $684,048, -0.2%, 6.3%, 82.0%
North-west, $774,309, -1.4%, 9.7%, 109.6%
Papakura, $683,812, -0.4%, 11.9%, 90.1%
Franklin, $671,396, 1.2%, 11.9%, 69.7%

Northern border, down country & national:

Whangarei, $483,049, 3.2%, 19.4%, 21.9%
Kaipara, $514,219, 9.2%, 25.1%, 29.6%
Hamilton, $537,152, 0.9%, 12.3%, 48.6%
Tauranga, $683,012, 1.3%, 15.4%, 41.9%
Wellington region, $727,119, 2.4%, 19.2%, 36.6%
Christchurch, $495,070, -0.7%, 1.0%, 30.5%
Queenstown-Lakes, $1,052,211, 1.2%, 20.3%, 53.0%
Invercargill, $243,144, 3.1%, 11.3%, 10.2%
Total NZ, $634,018, 0.4%, 9.7%, 53.0%

Link:
Full index: QV house price index for May 2017

Attribution: QV statistics & release.

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QV housing index shows much of Auckland stalled, fringes rising, gains around most of country

Quotable Value Ltd’s rolling 3-monthly house price index for the Auckland region fell for the third month in a row in April.

The indexes for the North Shore, Waitakere & Manukau (QV continues to calculate on the old council boundaries before the super-city came into being in October 2016) began their declines in February, but Manukau regained a small amount of ground in April.

The isthmus – the old Auckland City – stayed positive until its small decline in April.

Rodney – the poor rural cousin of the north, with a rapidly growing urban area on the Hibiscus Coast – has been registering 2%-plus gains this year as its prices catch up. In the south, Papakura & Franklin have made smaller gains.

Nothing about these movements, or those elsewhere in the country, is surprising. The boom run started in central Auckland, as it usually does, spiralled out through the region’s suburbs and eventually caught on around the country, again as it usually does.

The Auckland dream run – for affluent retirees wanting to sell out on a high – was pushed along by a shortage of stock in some more highly priced segments of the market, particularly in the eastern suburbs on the isthmus. In those circumstances, the arrival of planeloads of Chinese buyers wanting to invest in hard assets quickly, without any apparent concern for relativity within the local market, was a godsend for vendors.

New rules in both China & New Zealand have tamed the casino feel of the auctionrooms.

Prices on the isthmus, the North Shore and parts of old Manukau have declined, but the averages on the isthmus, the Shore and for the whole region remain above $1 million.

Price indexes in other parts of the country have shot up in recent months, as the charts for Wellington & Queenstown-Lakes demonstrate. Invercargill is an example of a city where prices began to pick up in late 2015, but it remains well behind the national index, which is dominated by the still more robust Auckland market.

Quotable Value said today Auckland values rose 10.7% over the last 12 months (8.4% when adjusted for inflation), the slowest annual rate of growth since December 2014. Nominally, and that’s what matters in a bull market, Auckland’s house values are 91% above the peak at the end of 2007, and 59.4% above when adjusted for inflation.

Nationally, the index rose 11.1% over the last 12 months (8.7% when adjusted for inflation), 52.3% since 2007 (27.2% net of inflation).

And the average prices are a mile apart – just over $1 million for Auckland, Wellington $602,000, the national average $631,000.

QV’s index figures around Auckland on the old council boundaries (old councils in bold) and for the Auckland region. The dollar figure is the average value for April. The first percentage is for the 3 months to April, the second is for the last 12 months and the third is the change since the 2007 peak:

Rodney, $956,733, 2.5%, 14.4%, 63.1%
North, $986,101, 2.6% 16.5%, 64.2%
Hibiscus Coast, $930,208, 2.3%, 12.5%, 58.4%
North Shore, $1,195,292, -1.6%, 8.5%, 85.2%
Coastal, $1,369,047, -1.3%, 9.2%, 81.7%
Onewa, $948,963, -2.3%, 7.5%, 91.3%
North Harbour, $1,179,375, -0.9%, 8.8%, 94.1%
Waitakere, $826,454, -1.2%, 9.6%, 94.9%
Auckland City, $1,223,387, -0.1%, 11.0%, 96.5%
Central, $1,079,879, 1.4%, 12.8%, 89.6%
East, $1,523,289, -0.6%, 10.6%, 91.1%
South, $1,098,608, -0.8%, 10.2%, 104.1%
Hauraki Gulf islands, $1,061,490, 2.4%, 14.0%, 66.0%
Manukau, $903,160, 0.2%, 11.1%, 97.3%
East, $1,172,617, 1.2%, 12.6%, 96.7%
Central, $681,590, -0.7%, 7.5%, 81.3%
North-west, $775,680, -0.7%, 11.3%, 110.0%
Papakura, $693,239, 1.3%, 13.9%, 92.7%
Franklin, $669,518, 1.4%, 12.7%, 69.3%
Auckland region, $1,043,830, -0.4%, 10.7%, 91.0%

Northern border, down country & national:

Kaipara, $493,324, 6.3%, 22.8%, 24.4%
Hamilton, $538,832, 1.4%, 14.1%, 49.1%
Tauranga, $678,643, 0.9%, 17.5%, 40.9%
Wellington region, $602,230, 3.4%, 21.2%, 32.2%
Christchurch, $495,855, -0.3%, 1.4%, 30.7%
Queenstown-Lakes, $1,041,830, 0.9%, 23.7%, 51.5%
Invercargill, $239,486, 0.1%, 10.0%, 8.6%
Total NZ, $631,147, 0.0%, 11.1%, 52.3%

Link:
QV house price index April 2017

Attribution: QV statistics & release, my commentary.

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QV house price index shows central Auckland holding, Shore & Waitakere down again, extremities rising

Quotable Value Ltd’s monthly house price index, out today, shows a continuing slide in values around some of Auckland in March, but the extremities of Rodney & Franklin still catching up on the growth they’ve missed out on over the last 9 years.

The indexes for the extremities – and for the rest of the country – will turn downward before they do catch up. In the meantime, however, their values have been growing over the last few months while the indexes for Auckland’s main urban areas have softened.

QV produces its monthly house price index on rolling 3-month & 12-month bases.

It’s not all downward on the isthmus – the index for the central area was up 0.7% in February and still showing a 0.1% gain in the 3 months to March. The eastern suburbs were up 1.3% in the 3 months to February, and rose to a 1.5% gain in the latest 3-month period, to March. The southern suburbs lost ground in February, down 1.3%, but regained 0.3% in March.

And the islands, chiefly Waiheke, gained 2.7% in the 3 months to March and increased that gain to 4.4% in the latest period, though those figures need to be assessed against a low volume of data, which can result in exceptional index movements.

North Shore & Waitakere prices weakened in the 3 months to February, and lost further ground in March, except in the North Harbour (Albany) area, where the index was static in March.

Mixed picture around country

Around the country, the price picture is mixed.

The cheapest city in the country, Gisborne, made a 2.8% gain in the latest 3 months, Queenstown Lakes the one place outside Auckland with an average price over $1 million – gained 2%, Wellington 3.7% – and Central Otago 10%.

Over the longer period since the previous price peak, at the end of 2007, Auckland – from the Shore down to Papakura – remains well ahead of the price level 9 years ago. The southern suburbs on the isthmus are 106% ahead of the 2007 level, and the north-west of old Manukau City is 110% ahead.

The Wellington region, left well behind during Auckland’s strongest boom years, is still only 30.7% ahead of the level in 2007, compared to a 60% gain in Rodney and a 69% gain in Franklin over that period.

QV national spokeswoman Andrea Rush said, “The Wellington region continues to see some of the strongest value growth of any area in New Zealand, particularly in more affordable areas outside the central city such as Porirua & the Hutt Valley.”

“Meanwhile, values in parts of Auckland, Hamilton & Christchurch are still seeing a slight downward trend, but values are stabilising and continuing to rise in other parts of these main centres as well. This means the downward trend & dampening in these markets seen since the latest round of loan:value ratio restriction may be shallower than expected.

“It’s possible we may see values start to rise in these main centres in coming months, given that the market is still being driven by a high number of sales to investors, record high net migration, relatively low interest rates, a lack of supply and fewer taxes on property investment than many other countries.”

QV’s index figures around Auckland on the old council boundaries and for the Auckland region. The first percentage is for the 3 months to February, the second is for the 3 months to March, followed by changes over the last 12 months & since the 2007 peak. The dollar figure is the average value for March:

Rodney, $940,701, 1.4%, 1.2%, 13.3%, 60.4%
North, $964,038, 0.8%, 0.7%, 13.4%, 56.7%
Hibiscus Coast, $920,149, 2.6%, 1.8%, 13.3%, 60.5%
North Shore, $1,201,367, -2.2%, -1.4%, 11.5%, 86.2%
Coastal, $1,375,264, -2.7%, -1.5%, 12.6%, 82.5%
Onewa, $952,902, -2.2%, -2.3%, 9.9%, 92.1%
North Harbour, $1,184,914, -1.0%, 0.0%, 11.1%, 95.0%
Waitakere, $828,959, -1.7%, -1.4%, 12.1%, 95.5%
Auckland City, $1,229,715, 0.2%, 0.9%, 12.5%, 97.5%
Central, $1,062,943, 0.7%, 0.1%, 10.8%, 86.6%
East, $1,542,858, 1.3%, 1.5%, 13.3%, 93.6%
South, $1,108,497, -1.3%, 0.3%, 12.2%, 105.9%
Islands (all on low data), $1,066,785, 2.7%, 4.4%, 17.8%, 66.9%
Manukau, $900,324, -0.4%, -0.5%, 12.6%, 96.7%
East, $1,165,890, -0.7%, 0.4%, 13.8%, 95.6%
Central, $681,232, -1.7%, -1.0%, 9.3%, 81.2%
North-west, $775,666, 1.6%, -0.8%, 13.3%, 109.9%
Papakura, $689,859, 0.9%, 1.2%, 12.6%, 91.8%
Franklin, $667,209, 2.4%, 1.1%, 13.1%, 68.7%
Auckland region, $1,045,362, -0.7%, -0.2%, 12.3%, 91.3%

Other places & nationally:

Kaipara (all on low data), $471,203, 0.8%, 20.6%, 18.8%
Hamilton, $532,888, -0.4%, 15.7%, 47.4%
Gisborne, $276,793, 2.8%, 18.0%, -6.9%
Wellington region, $595,501, 3.7%, 21.2%, 30.7%
Queenstown Lakes, $1,042,258, 2.0%, 28.5%, 51.6%
Central Otago, $437,791, 10.0%, 22.8%, 38.1%
Total NZ, $631,432, 0.6%, 12.9%, 52.4%

Attribution: QV tables & release.

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Shore & Manukau housing values drop over last quarter

Housing values on the North Shore, a few spots on the isthmus and in Manukau have slipped in the latest report by Quotable Value, out today.

QV produces its monthly house price index on rolling 3-month & 12-month bases.

The whole of the Auckland region slipped by 0.7% in the last 3 months. The biggest declines in the region were in the old North Shore City boundaries, where the index for the whole the old city fell 2.2%, as did the Onewa area. Coastal property values fell 2.7% on average.

Nationally, values were up 1.1% over the 3 months, 13.5% over the last year.

QV said the index for Auckland was still up 12.8% over the year despite the more recent declines. Adjusted for inflation, Auckland values rose 11.3% over the last year, 61% since the 2007 peak. Nationally, adjusted for inflation, the index rose 12.0% over the year, 28.5% since the 2007 peak.

QV’s index figures around Auckland on the old council boundaries, plus Kaipara, the Auckland & Wellington regions and nationally – the latest average value & index shifts in the last 3 months, last 12 months & since the 2007 peak:

Kaipara, $470,913, 8.1%, 25.3%, 18.7%
Rodney, $936,877, 1.4%, 13.6%, 59.7%
North, $957,228, 0.8%, 13.6%, 59.4%
Hibiscus Coast, $918,495, 2.6%, 13.4%, 56.4%
North Shore, $1,196,987, -2.2%, 11.2%, 85.5%
Coastal, $1,363,263, -2.7%, 11.6%, 80.9%
Onewa, $962,999, -2.2%, 11.0%, 94.1%
North Harbour, $1,176,182, -1.0%, 11.2%, 93.6%
Waitakere, $831,705, -1.7%, 13.8%, 96.2%
Auckland City, $1,224,673, 0.2%, 12.5%, 96.7%
Central, $1,062,336, 0.7%, 11.6%, 86.5%
East, $1,540,731, 1.3%, 13.5%, 93.3%
South, $1,100,193, -1.3%, 11.5%, 104.4%
Islands, $1,057,341, 2.7%, 18.9%, 65.4%
Manukau, $902,477, -0.4%, 14.2%, 97.2%
East, $1,159,890, -0.7%, 14.5%, 94.6%
Central, $685,233, -1.7%, 11.6%, 82.3%
North-west, $785,112, 1.6%, 16.2%, 112.5%
Papakura, $686,465, 0.9%, 13.6%, 90.8%
Franklin, $663,638, 2.4%, 13.3%, 67.8%
Auckland region, $1,043,680, -0.7%, 12.8%, 91.0%
Wellington region, $589,784, 4.3%, 21.5%, 29.4%
Total NZ, $631,349, 1.1%, 13.5%, 52.4%

Link:
QV house price index for February 2017

Attribution: QV release.

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Tighter LVR rules bring fourth-quarter house price slowdown

Quotable Value Ltd’s house price index to December, released today, confirms the slowdown that became very evident in auctionrooms once the Reserve Bank introduced new restrictions that took effect from 1 October.

Those restrictions, announced in September, required residential property investors generally to have a 40% deposit for a mortgage loan, and owner-occupiers generally to have a 20% deposit.

A second slowdown cause is the more cautious approach taken by Chinese investors in Auckland towards the end of the year. That caution is likely to be heightened following tightening of capital outflows by China’s State Administration of Foreign Exchange over the New Year.

Auckland real estate agency Barfoot & Thompson’s managing director, Peter Thompson, saw every indication in his agency’s sales & supply figures on Monday that the rise in the residential market had stopped.

The Quotable Value figures for the Auckland region – the driver of price change throughout the country – show declines from November to December in the average price, December $1,047,179 (November $1,051,387), rolling quarterly value change, 1.5% (3.7%), rolling annual change, 12.2% (12.8%), and the increase in values for the region since the previous market peak at the end of 2007, 91.6% (92.4%).

2 places in Auckland index decreases for the last quarter – the Hauraki Gulf islands by 0.9% and central Manukau by 0.3%.

Wellington & Dunedin hold out against trend

QV national spokesperson Andrea Rush said the Auckland price increases were reduced net of inflation to 11.9% for the year, 62.4% since 2007. Nationally, those figures net of inflation were 12.2% for the year, 28.5% since 2007.

Ms Rush said: “December saw a continuation of the trend of a slowing rate of value growth, activity & demand. This trend has been seen in many of the main centres since the introduction of the loan:value ratioss, which require a minimum 40% deposit for investment properties.

“This, coupled with the annual Christmas holiday period slowdown, has led to a decrease in values in some parts of Auckland, Hamilton & Christchurch since November.

“However, in Wellington values continue to rise faster than in Auckland, but at a slightly slower rate than prior to the LVRs being introduced.

“In Dunedin, there has so far been no evident slowing in the housing market because of the new LVRs and value levels continue to increase and sales activity has remained strong throughout the Christmas period.

“This is likely to be due to the fact the Dunedin housing market offers a much lower entry level & price point than the other main centres. Thus it’s easier for investors to find a 40% deposit to purchase there and investors have remained active there.

“A similar trend of plateauing/decreasing values was seen in the Auckland market over the summer period last year following the introduction of the (30%) LVRs for the super-city region only.

“In 2016, the Auckland market then picked up in March, which is usually the busiest month of the year, and it’s possible we may see this happen again.

“However, if interest rates continue to rise during 2017, this may further reduce demand from investors and lead to a longer period of lower value growth.

“But any slowdown will be balanced by the fact the market is still being driven by strong net migration, relatively low interest rates and a lack of supply compared to the demand, particularly in Auckland.”

Mixed picture in Auckland

QV’s Auckland general manager, Jan O’Donoghue, said: “With interest rates set to rise further during 2017, it appears some investors are choosing not to buy more property as they have lower expectations of potential capital gains during 2017. However, properties with subdivision potential under the new unitary plan are still selling well and achieving record prices.

“This includes properties in areas that are close to up-&-coming town centres and have good transport links, in suburbs such as Mt Wellington & New Lynn.

“Units that don’t have subdivision potential are less popular because there is low expectation of achieving capital gains.”

QV’s index figures around Auckland on the old council boundaries, plus Kaipara, Hamilton, Tauranga, the Auckland & Wellington regions, Christchurch, Queenstown Lakes and nationally – the latest average value & index shifts in the last 3 months, last 12 months & since the 2007 peak:

Kaipara, $467,348, 8.0%, 27.8%, 17.8%
Rodney, $929,162, 3.8%, 14.0%, 58.4%
North, $957,501, 4.9%, 15.6%, 59.4%
Hibiscus Coast, $903,672, 3.0%, 12.4%, 53.9%
North Shore, $1,395,709, 1.5%, 12.1%, 88.8%
Coastal, $1,218,254, 0.9%, 11.8%, 85.2%
Onewa, $975,593, 0.0%, 11.1%, 96.7%
North Harbour, $1,184,533, 0.6%, 12.4%, 94.9%
Waitakere, $840,639, 2.0%, 12.4%, 98.3%
Auckland City, $1,218,979, 2.0%, 11.2%, 95.8%
Central, $1,062,115, 4.0%, 11.7%, 86.5%
East, $1,520,349, 2.5%, 10.7%, 90.8%
South, $1,104,779, 0.2%, 11.5%, 105.2%
Islands, $1,021,594, -0.9%, 12.7%, 59.8%
Manukau, $904,516, 1.0%, 13.6%, 97.6%
East, $1,161,823, 0.6%, 13.7%, 94.9%
Central, $688,248, -0.3%, 11.1%, 83.1%
North-west, $781,663, 2.2%, 15.4%, 111.6%
Papakura, $681,953, 2.1%, 13.3%, 89.6%
Franklin, $659,906, 4.9%, 13.8%, 66.8%
Auckland region, $1,047,179, 1.5%, 12.2%, 91.6%
Hamilton, $534,860, 1.1%, 20.4%, 48.0%
Tauranga, $672,197, 4.3%, 24.0%, 39.6%
Wellington region, $574,410, 3.9%, 20.5%, 26.1%
Christchurch, $494,247, -0.3%, 2.5%, 30.3%
Queenstown Lakes, $1,022,214, 6.6%, 31.6%, 48.6%
Total NZ, $627,905, 1.3%, 12.5%, 51.5%.

Earlier story:
6 September 2016: Reserve Bank confirms loan restrictions go nationwide

Attribution: QV release.

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Auckland housing market slows and Queenstown’s jumps

Quotable Value Ltd said yesterday the rise in Auckland’s house values in the 12 months to November, 12.8%, was the slowest rate since January 2015.

Nationally, the 12.4% index rise was the slowest since May.

QV's index for Queenstown to November 2016.

QV’s index for Queenstown to November 2016.

But it’s not all slower. In Queenstown, the QV index has risen 32.2% in the last year, taking the average price there over $1 million.

QV national spokesperson Andrea Rush said nationwide quarterly growth eased back to 2% as the latest round of loan:value ratio restrictions made the spring market weaker than usual.

She said that, while growth was slowing in Auckland, Wellington, Hamilton & Christchurch, values continued to rise elsewhere.

The Auckland rise of 12.8% over 12 months was cut to 12.6% net of inflation, and the 92.4% rise since the 2007 peak was cut to 63.1%. The rise in the last 3 months was 3.7%.

Nationally, the rise of 12.4% over 12 months was cut to 12.1% net of inflation, and the 50.8% rise since the 2007 peak was cut to 27.8%. The rise in the last 3 months was 2%.

The average value in Auckland reached $1,051,387 (up $6180 from October), in Queenstown $1,000,205, and nationally it was $624,675.

QV Auckland general manager Jan O’Donoghue said: “It’s a tale of 2 different markets in Auckland currently. We are continuing to see strong demand in the $1.5 million–plus bracket and the new-build market, which is resulting in high sales prices being achieved for these properties.

“But at the same time there’s been a significant reduction in demand for entry-level investor housing stock, particularly in Manukau, over the past month, and sales prices for this type of property have reportedly dropped back by as much as 20-30% on what was being achieved earlier in the year.

“There has been a late surge of new listings coming on to the market from buyers wanting to sell prior to Christmas, and this increased the sense that it’s currently more of a buyers’ market than it has been since the beginning of the year in some areas.”

QV’s index figures around Auckland on the old council boundaries, plus Kaipara, Queenstown, the Auckland & Wellington regions & nationally – the latest average value & index shifts in the last 3 months, last 12 months & since the 2007 peak:

Kaipara, $435,635, 2.0%, 21.8%, 9.8%
Rodney, $923,594, 6.2%, 15.2%, 57.5%
North, $949,942, 7.7%, 16.6%, 58.2%
Hibiscus Coast, $895,003, 4.2%, 13.3%, 52.4%
North Shore, $1,224,477, 3.5%, 12.5%, 89.8%
Coastal, $1,400,984, 4.1%, 12.6%, 85.9%
Onewa, $984,557, 2.7%, 12.2%, 98.5%
North Harbour, $1,188,075, 3.0%, 13.3%, 95.5%
Waitakere, $845,864, 4.8%, 13.1%, 99.5%
Auckland City, $1,222,371, 3.6%, 11.6%, 96.4%
Central, $1,055,002, 4.2%, 10.9%, 85.2%
East, $1,520,825, 3.7%, 11.2%, 90.8%
South, $1,115,066, 2.7%, 12.1%, 107.1%
Islands, $1,029,854, 0.8%, 14.3%, 61.1%
Manukau, $906,004, 2.8%, 13.7%, 97.9%
East, $1,168,113, 3.1%, 14.6%, 96.0%
Central, $696,784, 2.6%, 11.9%, 85.4%
North-west, $772,913, 2.0%, 14.2%, 109.2%
Papakura, $680,134, 3.4%, 14.2%, 89.1%
Franklin, $647,904, 4.3%, 12.6%, 63.8%
Auckland region, $1,051,387, 3.7%, 12.8%, 92.4%
Wellington region, $565,631, 5.5%, 20.6%, 24.1%
Queenstown Lakes, $1,000,205, 7.5%, 32.2%, 45.4%
Total NZ, $624,675, 2.0%, 12.4%, 50.8%

Link:
QV House Price Index (HPI) for November 2016

Attribution: QV release.

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QV says house price rises slowing

Quotable Value Ltd’s latest monthly house price index shows a slowdown both in Auckland & nationally.

In Auckland, the 13.8% increase in the year to October was the lowest since March 2015.

Nationally, the 12.7% increase was the lowest since May.

QV national spokesperson Andrea Rush said yesterday: “The index is now showing a slight tick to the right, which reflects an easing of 1.6% in the annual rate of growth over the past month as the latest round of loan:value ratio (LVR) restrictions begin to take effect.

“Sales volumes are down by around 12% on the same period last year and mortgage approval rates are also down.

“Home values continue to rise faster in the Wellington region than the Auckland region, and the housing market in the capital appears largely unaffected by the new LVR restrictions, particularly at the more affordable end of the market in areas such as the Hutt Valley, Porirua & the Kapiti Coast.

“Auckland, Tauranga & Hamilton home values are continuing to rise, just at a slightly slower pace than they were prior to the new LVR measures being introduced in late July.

“The Dunedin market also continues to see good levels of activity and demand, while investors are less active in the Christchurch market and home values there continue to show only moderate value growth.
“The new-build market remains strong across the country as the new LVR restrictions for investors do not apply for new homes.

“Less established investors appear to be having difficulty raising finance with the new 40% deposit requirement, while recent CoreLogic buyer classification data shows that 34% of investors with 5 or more properties do not need to raise a mortgage so are not affected by the new LVR rules.

“Those investors shut out of more expensive markets appear to be turning their sights to more affordable markets in relatively close proximity to North Island main centres such as the Western Bay of Plenty, Whangarei, Rotorua & the Waikato District, and all of these areas continue to see very strong value growth.

“It appears that new investors and ‘mum & dad’ investors are the ones most affected as they are reliant on higher loan:equity ratios, and so tend to be more affected by the LVR changes than well established investors.

“There are reports of investors’ having more difficulty raising the extra finance through banks, following the new LVR changes. There are still properties selling, but it is not as easy as it was prior to the new changes coming into play.”

The QV index shows Auckland up 5.3% in the last 3 months, 13.8% for the year, 91.3% since the previous market peak at the end of 2007. Adjusted for inflation, the rises were 13.6% for the year, 62.1% since 2007. QV put the average value for the region at $1,045,207 in October.

Nationally, the rises were 3.3% for the last 3 months, 12.7% for the year, 50.2% since 2007. Adjusted for inflation, the rises were 12.4% for the year, 27.4% since 2007. The average value nationwide was $622,309.

QV’s index figures around Auckland on the old council boundaries, plus Kaipara, the Auckland & Wellington regions & nationally – the latest average value & index shifts in the last 3 months, last 12 months & since the 2007 peak:

Kaipara, $436,144, 3.3%, 20.2%, 9.9%
Rodney, $918,899, 6.9%, 17.1%, 56.7%
North, $940,204, 7.5%, 17.5%, 56.5%
Hibiscus Coast, $896,988, 6.2%, 16.4%, 52.7%
North Shore, $1,220,550, 5.2%, 13.5%, 89.1%
Coastal, $1,391,044, 5.2%, 12.9%, 84.6%
Onewa, $990,038, 5.6%, 13.9%, 99.6%
North Harbour, $1,179,794, 4.8%, 14.4%, 94.2%
Waitakere, $837,300, 7.1%, 13.5%, 97.5%
Auckland City, $1,209,199, 3.9%, 12.0%, 94.2%
Central, $1,040,640, 3.7%, 11.4%, 82.7%
East, $1,497,097, 3.0%, 11.4%, 87.9%
South, $1,112,901, 4.9%, 13.0%, 106.7%
Islands, $1,032,945, 5.1%, 16.5%, 61.6%
Manukau, $906,128, 5.5%, 15.6%, 98.0%
East, $1,173,581, 6.6%, 16.7%, 96.9%
Central, $698,842, 5.5%, 13.9%, 85.9%
North-west, $768,563, 3.6%, 16.0%, 108.0%
Papakura, $683,031, 6.9%, 16.3%, 89.9%
Franklin, $641,668, 4.6%, 13.9%, 62.2%
Auckland region, $1,045,207, 5.3%, 13.8%, 91.3%
Wellington region, $558,886, 6.6%, 21.1%, 22.6%
Total NZ, $622,309, 3.3%, 12.7%, 50.2%

Link: QV full house price index for October 2016

Attribution: QV release & index.

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QV Auckland index gain well down from previous 12 months

Quotable Value Ltd’s house price index for Auckland rose 5.8% over the last 3 months and 15.0% in the last year, down from a 22.6% gain in the previous 12 months.

The increase since the last market peak at the end of 2007 has risen from 64.1% a year ago to 88.7%.

Adjusted for CPI (consumers price index) inflation, the increase for the year was 14.5%, and 60.2% since 2007.

The average value (not sale price) for the region rose $17,600 from August to $1,031,253.

QV said in its monthly report out today its Wellington index was rising more than Auckland’s this year – up 7.1% for the last quarter, 21.2% over 12 months, but still nearly half a million dollars short of the Auckland average after rising 21.4% since 2007.

Nationally, the index rose 4.9% in 3 months, 14.3% in 12 and 49.5% since 2007. Adjusted for inflation, the 12-month rise was 13.8%, and 27% since 2007.

QV national spokesperson Andrea Rush said: “The Wellington market continues to show strong levels of activity & demand.

“Despite a clear slowing in activity & demand in the Auckland, Hamilton & Tauranga markets since the introduction of the new loan:value ratio (LVR) restrictions for investors, we are seeing little evidence of a slowdown in value growth in these main centres.

“The Dunedin market remains buoyant and values there continue to rise steadily, with Auckland investors having an increasing presence, while the Christchurch market remains relatively stable in terms of value growth by comparison.

“Queenstown Lakes District has seen the highest annual rate of value growth of anywhere in the country, rising 30.7% since September last year.

“Many regional centres around the country also continue to experience strong value growth, with western Bay of Plenty, Rotorua, Kawerau, the Hauraki District, Whangarei, Napier, Hastings & Nelson markets some of the standout regional performers.”

“Centres with entry-level properties under $350,000 appear less impacted by the new LVR restrictions, most likely due to the fact the new 40% deposit requirement for investment properties is easier to achieve at a lower price point.”

QV’s index figures around Auckland on the old council boundaries, plus Kaipara, the Auckland & Wellington regions & nationally – the latest average value & index shifts in the last 3 months, last 12 months & since the 2007 peak:

Kaipara, $432,722, 3.3%, 20.9%, 9.1%
Rodney, $894,816, 4.8%, 17.0%, 52.6%
North, $913,102, 5.3%, 17.7%, 52.0%
Hibiscus Coast, $877,070, 4.1%, 16.2%, 49.3%
North Shore, $1,207,974, 14.8%, 14.8%, 87.2%
Coastal, $1,375,501, 6.1%, 14.1%, 82.5%
Onewa, $975,610, 6.8%, 13.9%, 96.7%
North Harbour, $1,177,378, 6.3%, 17.9%, 93.8%
Waitakere, $824,528, 6.9%, 14.5%, 94.5%
Auckland City, $1,194,608, 4.2%, 13.0%, 91.9%
Central, $1,021,399, 2.6%, 11.8%, 79.3%
East, $1,482,962, 3.5%, 13.2%, 86.1%
South, $1,102,652, 6.0%, 13.7%, 104.8%
Islands, $1,030,893, 6.3%, 16.7%, 61.3%
Manukau, $895,932, 6.4%, 17.5%, 95.7%
East, $1,154,978, 6.6%, 18.1%, 93.8%
Central, $690,259, 6.2%, 15.8%, 83.6%
North-west, $764,574, 5.6%, 18.2%, 106.9%
Papakura, $667,893, 6.6%, 17.4%, 85.6%
Franklin, $629,381, 2.9%, 13.6%, 59.1%
Auckland region, $1,031,253, 5.8%, 15.0%, 88.7%
Wellington region, $553,023, 7.1%, 21.2%, 21.4%
Total NZ, $619,660, 4.9%, 14.3%, 49.5%

Link:
QV full house price index for September 2016

Attribution: QV release & graphs.

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REINZ Auckland house sales median up 14%, but CoreLogic warns of slowdown

The median price of sales recorded in Auckland by the Real Estate Institute rose by $102,500 (+14%) to a record high of $842,500 in August.

Last week, Quotable Value Ltd put the average value of Auckland housing at $1 million. The QV index, “powered” by input from the international CoreLogic group, is based on sales on a moving 3-month period (more on that below).

The Real Estate Institute said on Wednesday prices rose by 21% in Manukau in August, 20% in outer Auckland and 14% in Rodney (which includes the Hibiscus Coast) and on the isthmus. Compared to July the median price rose by $17,500 (2%) – 9% in Auckland City, 3% in outer Auckland and 1% in Rodney & Manukau.

Institute spokesman Bryan Thomson said inventory levels were low but slowly increasing – in Auckland, up from 10 weeks’ supply in July to 12 weeks’ supply in August. He said sales volumes fell 20% in Auckland compared to a year ago, and 3% nationally.

“The indications are that the struggle for stock is the biggest factor driving market behaviour & price expectations across the country, as we await spring listings. The continued shortage of listings, coupled with the impact of the loan:valuation ratio (LVR) changes on investors, is seeing sales volumes more muted than expected at this time of year.”

The institute recorded 7527 unconditional sales in August, up 3% on July but down 3% from a year ago.

Section sales, which are exempt from the new LVR ratios, jumped 37% nationally compared to last August. Auckland section sales were up 19%.

CoreLogic view

CoreLogic NZ Ltd’s head of research, Jonno Ingerson, said when the $1 million tag arrived last week:This latest milestone has led to the housing minister being labelled the ‘million dollar minister’, the front page of the papers & the news websites have been awash with breathless stories of Auckland’s unaffordability, and the talkback lines filled with the usual pundits.

“Why don’t I care? Because it’s just a number. It’s just one way of measuring Auckland’s house prices. I could give you 5 others, some of which show Auckland has been beyond a million dollars for a long time, and others which show it is yet to get there.

“But they all share the same common theme. Auckland’s house prices have been rising for years and very little has been done that has slowed them. Affordability is now a very real issue for many people…. That story might be about to change, at least for a while. I’m watching some hard data coming across my desk that suggests the heat has well & truly come out of the market.”

Mr Ingerson said the monthly QV house price index was an extremely reliable measure of value change in the housing stock of an area, but it turned slowly by being based on data from the last 3 months. However, he added that “anything more reactive than the QV house price index tends to be more volatile, so you’re never sure if an up or a down is real or noise”.

Back to the Real Estate Institute figures:

Sales nationally in price brackets and their share of the market in August 2016 (August 2015 in brackets):

$1 million-plus, 987 (848), 13.1% (10.9%)
$600-999,999, 1915 (1834), 25.4% (23.6%)
$400-599,999, 1819 (1995), 24.2% (24.9%)
Under $400,000, 2806 (3150), 37.3% (40.6%)

2 years ago, in August 2014, 46% of sales were in the under-$400,000 bracket. During the next year that bottom bracket’s share of the market slid, but in the last year it’s moved in a range of about 4%.

Around the Auckland region on the old boundaries, August 2016 median & sales with July 2016 & August 2015 in brackets:

North Shore, $1,045,000 ($1,062,500, $935,500), 410 (408, 556)
Waitakere, $800,000 ($803,000, $741,000), 345 (350, 404)
Auckland City, $911,750 ($837,000, $800,000), 726 (817, 906)
Manukau, $815,000 ($805,000, $675,000), 462 (473, 595)
Rodney, $862,500 ($852,500, $755,650), 192 (178, 184)
Auckland region, $842,500 ($825,000, $740,000), 2413 (2520, 3002)

Link: Ingerson blog article on index

Earlier story:
7 September 2016: Multiple owners still highly active as QV Auckland housing index tops $1 million

Attribution: Real Estate Institute, CoreLogic.

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