Regional markets around New Zealand are only growing stronger as record median prices are seen in Waikato/Bay of Plenty, Hawke’s Bay, Wellington, Nelson/Marlborough and Otago, according to the Real Estate Institute of New Zealand’s (REINZ) monthly residential sales report for December.
“Regional markets…are now setting the pace for the New Zealand real estate market, with Auckland, in a relative sense, now in the middle of the pack,” says REINZ chief executive Colleen Milne.
“The decline in sales volume in Auckland, while noticeable, is likely transitory as the region gets to grips with the new LVR rules for investors, although the median price continues to firm.”
Excluding the impact of the Auckland region, the national median price rose $28,000 to $379,000 compared to December 2014 to reach its fourth record high in a row, and rose 1.1% compared to November.
“Over the past six months regional markets have demonstrated: large declines in the levels of inventory, a significant decline in the number of days to sell, and noticeable increases in the median price, with a number of regions setting new median price records more than once over 2015,” says Milne.
“This breadth of the improvement across New Zealand suggests that there is more is at play than just an Auckland ‘halo effect’, although that has contributed in the northern regions.”
Central Otago Lakes recorded the largest percentage increase in median price compared to December 2014, at 20.4%, followed by Northland at 20% and Southland at 13.9%. Central Otago Lakes recorded the largest percentage increase in median price compared to November, with a 16.2% increase, followed by Northland with a 6.9% increase and Manawatu/Wanganui with a 5.3% increase.
The report stated that transactions in Auckland continue to represent the majority of national auction sales but the dominance of Auckland has declined significantly over the past 12 months, from 75% of all auction sales in December 2014 to 51% in December 2015.
In contrast the number of auction sales in Waikato/Bay of Plenty has increased from 107 (7.4%) in December 2014 to 373 (27.0%) in December 2015, a year-on-year increase of 249%.
Across New Zealand, there was a 20% rise in the number of sales over $1 million between December 2014 and December 2015 – from 629 to 755.