The latest research from Massey University reveals conditions have declined since last year and the most recent quarter
The latest research from Massey University reveals conditions have declined since last year and the most recent quarter.
Only two areas have seen housing affordability improve. Otago, excluding the expensive Central Otago Lakes region improved by 1.9% over the most recent quarter (March-May 2017); and Canterbury/Westland which saw a 0.5% improvement year-on-year.
Nationwide, the median house sales price was up 9.1% in the quarter and 6.8% year-on-year but that belies the sharp rise in prices seen in some markets.
“Some of the regions are surging past Auckland as a percentage change,” says report author Associate Professor Graham Squires from Massey’s School of Economics and Finance. “Year-on-year median house prices in Northland have increased by 28.3% and in Nelson prices are up 21.8%. This compares to a 3.7% increase in Auckland.”
House prices are the main cause of declining housing affordability in most regions but in Central Otago Lakes, where affordability is 70% lower than the rest of the country, there are several factors in play.
“It’s likely this decline in affordability in Central Otago Lakes is a continued reflection of tourism industry demand in Queenstown, a shortage of housing supply, speculative investment demand and largely stagnant wages in the region,” Dr Squires says.
Auckland is also significantly less (48%) affordable than the rest of New Zealand and the ability of first-home buyers to enter the market.
Median house prices in Central Otago Lakes are now 15.2 times annual wages and in Auckland they are 13.3 times annual wages.
The most affordable region is Southland despite the median house price increasing by 14.8% (or $31,000) in the most recent quarter, which meant a 13.7% decline in affordability.
“Southland has a traditionally low base in median house prices, but has now joined eight other regions in surpassing Auckland in terms of their percentage price increase over the past 12 months,” Dr Squires says.
Only two areas have seen housing affordability improve. Otago, excluding the expensive Central Otago Lakes region improved by 1.9% over the most recent quarter (March-May 2017); and Canterbury/Westland which saw a 0.5% improvement year-on-year.
Nationwide, the median house sales price was up 9.1% in the quarter and 6.8% year-on-year but that belies the sharp rise in prices seen in some markets.
“Some of the regions are surging past Auckland as a percentage change,” says report author Associate Professor Graham Squires from Massey’s School of Economics and Finance. “Year-on-year median house prices in Northland have increased by 28.3% and in Nelson prices are up 21.8%. This compares to a 3.7% increase in Auckland.”
House prices are the main cause of declining housing affordability in most regions but in Central Otago Lakes, where affordability is 70% lower than the rest of the country, there are several factors in play.
“It’s likely this decline in affordability in Central Otago Lakes is a continued reflection of tourism industry demand in Queenstown, a shortage of housing supply, speculative investment demand and largely stagnant wages in the region,” Dr Squires says.
Auckland is also significantly less (48%) affordable than the rest of New Zealand and the ability of first-home buyers to enter the market.
Median house prices in Central Otago Lakes are now 15.2 times annual wages and in Auckland they are 13.3 times annual wages.
The most affordable region is Southland despite the median house price increasing by 14.8% (or $31,000) in the most recent quarter, which meant a 13.7% decline in affordability.
“Southland has a traditionally low base in median house prices, but has now joined eight other regions in surpassing Auckland in terms of their percentage price increase over the past 12 months,” Dr Squires says.
