Auckland finds its middle ground; Tasman takes the popularity prize; and overall house prices put on a buoyant show. Read on for a snapshot of housing market stats and commentary.
Kiwi housing market update | Published: June 2018
In his first monetary policy statement, new Reserve Bank of New Zealand’s governor, Adrian Orr kept the Official Cash Rate (OCR) at 1.75%, adding that the direction of the next move is ‘equally balanced, up or down’.
“Only time and events will tell,” Orr said. “We’re in a good spot. We can keep the OCR where it is for a considerable period of time.”
Economists were unanimous in praising Orr’s open style, delivery and clarity of message, seeing it as a welcome change of tone. Orr himself acknowledged the fact that the Reserve Bank had not done enough to raise financial literacy in recent times.
“Our challenge is to speak in plain English as opposed to a high-tech scientific language around which only a half a dozen people understand and even less are interested in,” he said.
The housing market saw growth across the country. In May, the Real Estate Institute of New Zealand (REINZ), reported a national median house price of $562,000 - a 5% increase year-on-year and a new record for the New Zealand housing market.
Annual prices increases were reported in most regions; the only exceptions being Auckland, Gisborne, and Southland.
“The record price for New Zealand of $562,000 continues to highlight the buoyancy of the housing market across the country,” said REINZ”s chief executive, Bindi Norwell. “Of the 16 regions in New Zealand, 13 saw an annual price increase – 5 of which were double digit increases showing that the demand or good property continues unabated.”
While the Auckland median price dropped in May to $852,000 - a year-on-year decrease of $10,800 - sales volumes were 5.4% higher than in May 2017.
“Looking at Auckland, it seems like the market has found a middle ground around the $850,000 mark, as 3 out of the past 5 months have seen a median price in this range. This suggests that the standoff between buyers wanting a bargain and sellers wanting an unrealistic price is coming to an end,” said Bindi Norwell.
“Putting the year-on-year figure into perspective, the REINZ HPI for Auckland increased 0.6% year-on-year, highlighting that, despite a decrease on medium price, the market is actually not in decline – it’s just a result of a decrease in $1 million plus properties year-on-year,” says Norwell.
The median house price in Tasman crossed the $600,000 threshold for the first time, jumping 16.2% to $612,000, and making it the second most expensive region in the country.
Norwell commented that the record median house price for Tasman highlights just how popular it continues to be: “The record medium price achieved in Tasman has seen the region skip both the Wellington and the Bay of Plenty to become the second most expensive region in New Zealand ... It is staggering to think that a region of 51,000 people has more expensive property than a region of nearly 514,000 people.”
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