House price growth in Auckland slows down

Auckland house prices have decreased by 0.6% from a year ago

House price growth in Auckland slows down
In June, Auckland house prices have decreased slightly by 0.6% from a year ago, according to latest data from the Real Institute of New Zealand.

The data also revealed that the City of Sails had the second lowest growth rate in the country in comparison to the 8% seen in June 2016 and 27.1% increase seen in June 2015.

“This is evidence that the ‘Supercity’ has showed signs of price growth slowing down – if you look at the month-on-month figure it shows a drop of -0.8%,” REINZ chief executive officer Bindi Norwell said.

“However, most regions across the rest of the country experienced double-digit (or close to it) growth and record median prices have been seen in three regions this month, highlighting the buoyancy across the rest of the country and the normal property cycle where regions are typically behind Auckland in terms of the growth curve.”

Bay of Plenty, Manawatu/Wanganui and Tasman hit new record high with $555,000, $280,000 and $581,000 median prices respectively.

Despite the slowdown in price growth, Auckland’s median price increased 2.5% to $850,000 from a year ago and the national median, excluding Auckland, registered 11.4% up to $431,000, and this all add up to the signs of New Zealand’s property market of “being a two-tier market”.

Moreover, national sales volumes have continued to decline – in Auckland they are 33.2% down for the year to June and nationally they’re 24.7% down for the same period.

The median number of days to sell a property nationally increased to 36 from 31 a year ago.

With seasonally adjusted median price trends still rising across many regions in New Zealand, Norwell said that talk of a decline in prices may be premature. 
“The Auckland market is the most mature in terms of the property cycle, however, at worst, prices in the Auckland region are steady at present,” Norwell added.

Meanwhile, despite steadying of Auckland house prices and a slowdown in total sales and the time it takes to sell, the overall outlook for real estate remains strong and positive, Century 21 NZ national manager Geoff Barnett said.

“When you seasonally adjust these numbers and compare them to one year ago not one month ago, they’re holding up really well. And let’s not forget that REINZ stated ‘at worst, prices in the Auckland region are steady at present’. Last year we heard a lot of doom and gloom from commentators about plummeting prices in 2017 and fast rising interest rates, but neither is nowhere near,” Barnett said.

“Auckland is still going well, even if time on market has moved out. While Waikato and the Central North Island, in particular, are also reporting a positive story,” he said.