Tough times for the NZ real estate market?

The housing market in New Zealand surpassed expectations of the industry and beyond amidst the pandemic. Even up until September, the nation’s property trade exhibited the highest growth since 2000- not a small feat by any means. The avg. yearly listings numbers across the NZ market as a whole, have gone down in comparison to 2020. There is a lack of open homes- which indicates homes ranging in the national avg. asking price coming into the market. and abundance of high-priced properties.

There were only13,407 homes available to buy; which is 23.7% lesser than the year-on-year. Lack of supply, coupled with pent-up demand has driven up the asking prices in some parts. But, the stringent Loan-to-Value diktats and high interest rates have also curbed some of that demand.

Experts and buyers should know, however, that while the average NZ asking price shows a stagnant market, the positive news has trickled out of other cities besides Auckland. While other localities are barely managing to hold on to their growth with Level 2, restrictions, Auckland is still racing, even with a Level 3 restriction.

Auckland housing market – still going strong?

Auckland has shown great promise in the last few months, reaching record median house price hikes in July and August. High demand coupled with FONFA (Fear Of Not Finding Anything) drove customers to purchase property at premium prices. A 5-year record-breaking 7345 properties exchanged hands across Auckland in June 2021; in comparison to June 2020.

This means the transactions had increased by 6.2% year on year. Nationally the average asking price was $893,794 and $875,197 in June and July, respectively. If Auckland housing market news and reports are to be believed, then the city’s property market is the only resilient sub-market amidst the September lockdown restrictions. Market experts and brokers remain hopeful because the month was not completely unproductive.

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Despite the Level-4 lockdown, there have been strong reports of lucrative property deals that brought the average asking price here to $1,196,975. Some of Auckland’s suburbs depicted record highs since the 2000s. Location’s such as Point England have witnessed a cool 616% hike, Glen Innes saw a 310% hike, and Wai ō Tāiki saw a 594% increment, in the last couple of decades. Locales such as Oneroa, and Point Chevalier have also shown great performance in the last half of a decade.

However, September news suggests that the property market here is now highly reliant on one-on-one viewings. New listings in September have been down by 57.9% in Auckland. The new listings are even lower than August listings by 34%. The housing stock is also down by a worrisome 21%. But, Auckland housing market predictions from hopeful experts suggest that these numbers should start climbing again, once the restrictions are lowered to level 2 from the incumbent Level 3.

What is in store for the rest of New Zealand?

Wellington has displayed a hike in the year-on-year listings numbers, with an increment of 26.3%, year-on-year. The average asking price here remained at a respectable $958,670 in September. There was a generous increase in listings, year-on-year, by 14.5%, and even the stock went up by 21.9%. Wellington locales, such as Hawkes Bay and Central North Island depicted a 15.2%and 1.6% hike, year-on-year. Overall, Wellington closed the monthly average at $1,082,993, a monthly increase which means a month-on-month increase of 1.7 percent

Overall, the days of fretting for the NZ property market may be short-lived. The rest of NZ can follow the Auckland housing market’s example and cope with easing growth rates. At $950,229, the yearly average value is up by 27.8%, year-on-year. In the saturated Auckland property market, the final average was at $1,346,964, a month-on-month increase of 0.7%.

Brokers and sellers can certainly hope that the prices shall grow, as soon as the restrictions are lowered, should the potential number of buyers in the market hold.

Auckland has seen a jump from 1 million to 1.6 million in population, in the last two decades. Demand for Auckland property allowed the city to attracted both local buyers and investors as well as foreign ones. But, the population explosion only served to increase demand and competition for availing quality suburban property in the city. The Auckland housing market also owes it to the Unitary Plan and low mortgage rates for consistently figuring in NZ’s Top 100 suburbs for capital gains.

Notable real estate analytics agencies have surmised that the metropolitan city and its suburbs should grow more cosmopolitan and see more capital gains with each passing day; especially, given the performance of some of these suburbs in the last 20 years.

The new fastest-appreciating suburbs in the Auckland housing market

East Auckland leads the charge in soaring house prices. Most of these locations have witnessed median home value gains in leaps and bounds, even compared to the most prestigious locales of the Super City. Although, these are not the only positive inferences from the aforementioned analytic reports. With higher values, properties in these locations also promise us:

Better amenities,
Larger section sizes,
Attractive property features,
A mission to redevelop 2500 state houses into 10,000+ odd private markets and affordable homes,
Higher demand and further appreciation of the asset values, as per Auckland housing market predictions.

The median value appreciation brings further positive news for investors and buyers as Auckland housing market predictions indicate the ascension of ‘dark horse’ entrants to the list of fastest-appreciating suburbs- and it is not just the prestigious ones like Herne Bay or Remuera. To make the most of these capital gains, we must focus on the following locations.

Point England

Point England rules the roost with the highest capital appreciation. Median home values here jumped from $176,400 to $1,263,250 between August 2001-2021- a 616% hike. Through NZ’s Urban Regeneration project, the suburb has retained its ranking for price growth throughout the last decade, accounting for a 336% hike. Even in the last year, the suburb outperformed expectations during the pandemic with a 35% hike.

Glen Innes

Glen Innes has also witnessed some fantastic capital growth in the last score. Glen Innes depicts a median price hike from $189,500 to $1,330,550, which means a 602% growth on avg. Home values here in 20 years. The suburb also joined the frontrunners as one of the top growth cases in the last decade, with a growth of 310%. Through the last 5 years, the suburb saw a hike of another 47%; and, even fought back the pandemic with another 35% hike.

Prime locations here such as East View Road have also helped Glen Inness join Point England as a part of NZ’s Urban Regeneration project. Glen Innes’s proximity to the CBD and transportation links further helped it stand out in the Auckland housing market.

Wai ō Tāiki

A whopping 594% increment in median house prices helped Wai ō Tāiki find its place on this list. Homes at this location went from$252,500 to $1,753,600 in 20 years. The last 10 years have been equally if not more favorable for Wai ō Tāiki, with a 323% increase in the avg. price. Wai ō Tāiki also shared the top spot for growth with Oneroa with 53% growth apiece in the last 5 years. The last year alone, the median rose in the suburb by another 34%.

Wai ō Tāiki’s growth has also been motivated by the same redevelopment initiative by the Tamaki Regeneration Company, which has been a driving factor in nearby Glen Innes. The presence of reserves, parks, and proximity to natural water bodies such as the Bucklands has also helped the cause.

Focus on these suburbs for a diverse, appreciative portfolio

Oneroa avg. home values grew 53% in 5 years, from $1,158,600 to $1,771,550. While Grey Lynn’s 5-year growth has been estimated at 47%, from $1,305,850 to $1,917,800. Ponsonby also witnessed a house value hike from $380,600 to $2,551,800, equalling a 570% boost.

Ōtara and Māngere East deserve consideration for their performance in the last 10-years. Māngere’s hike of 310% took values from $286,100 to $886,150; and, Ōtara’s hike of 310% took its median value from $254,200 to $793,400.

Point Chevalier makes the cut with a $298,800 to $2,020,400 hike in median house prices, in the last two decades. Auckland housing market predictions indicate further growth here down the line, with plans for development and gentrification.

Thus, these locations which were only known for government-supplied state homes just 20 years ago, are raking in millions at present.

Tag Archives: Auckland Housing Market forecast

Auckland Housing Market Average Asking Price Drops to 4-Month Low