Having softened in the final quarter of 2015, in response to regulatory changes, Auckland residential values returned to growth over the opening period 2016. The regional median lifted by 2.9% in the March quarter...
…albeit that sales activity remained relatively subdued. It seems that a number of buyers decided to adopt a “wait and see” approach following the introduction of the new rules and regulations in order to assess their impact on the market, The latest figures released by the Real Estate Institute of New Zealand (REINZ), however, suggest that the primary drivers, predominantly, low interest rates, the migration boom and regional housing shortage are having a greater influence on the market than changes to taxation provisions and lending restrictions.
The overall Auckland market remains tight, with figures from realestate.co.nz indicating that inventory for sale in April was only at 5,711, a 10.8% fall from 6,404 last year’s same month and 45% lower than the 8 year historic average of 10,378. The number of weeks to sell inventory (based on current sales activity, assuming no further listings are taken on) are still on their lowest levels, with the April 2016 figure being 10.3 weeks, significantly lower than the historic 8 year average of 24 weeks. This tightening is also illustrated by the latest REINZ data, which shows an acceleration in the speed of sales in February and March, resulting in the average days on market figure falling to 30 days in March from its 39 days level in January. Read more
A closer look at sales
An analysis of recent sales in Eastern Suburbs reinforces the top end status of the area in the Auckland region, with sales at $1.5million and more constituting half of the sales in the last quarter. Residential properties selling for under $1 million made up only 25% of total sales. In terms of property types, residential houses dominated the sales with nearly 70% of total transactions. Given the heightened building activity in apartment and units in the region, it is likely to result in a reduction in the relative share of stand alone houses in future years in favour of smaller property types.
Spotlight on Remuera
Following a brief downturn in house prices in line with the trend in wider Auckland region, which can be attributed to the imposition of the new regulatory environment, the Remuera market experienced a sharp increase in the median sales value in the first quarter of 2016. Values climbed by 6.6% or $103,500 compared to the previous quarter, reaching $1,681,000. The number of sales transactions were down 29% compared to the same quarter of the previous year to 108 concluded sales. Overall however, market conditions remain tight as illustrated by the fact that the average days on market figure, at 41 days has remained unchanged compared with the opening three months of last year. Read more
Spotlight on St Heliers
The seaside suburb of St Heliers has experienced a marked increase in values in recent years. Its seaside charm, proximity to the heart of Auckland city, along with a large number of cafés, restaurants, boutique shopping and stunning views of Rangitoto all combining to entice people to live in the area. Read more
Read the full Marketbeat report online here