Housing market bolts away: Auckland up 16.3% to hit $1m, NZ prices up 19.8%

New Zealand’s super-charged housing market has rocketed even further ahead, with Auckland’s median hitting $1 million for the first time.

National prices have also risen almost 20 per cent in a year.

While the Reserve Bank is being tipped to re-introduce loan to value ratios to restrict lending once again, new Real Estate Institute data for October showed Auckland house prices bolted ahead 16.3 per cent annually from $860,000 to the new six-figure average.

The national median shot up 19.8 per cent from $605,000 last year to $725,000 last month.

“October will go down in housing history as being the point in time when Auckland region’s median house price hit the million-dollar mark for the first time – something no one anticipated or expected just six months after the entire country came out of lockdown,” said REINZ chief executive Bindi Norwell.

Earlier this year, economists forecast prices to fall 6 to 9 per cent by either December or next March.

Auckland city’s median is $1,200,000, Manukau’s $1m and the North Shore’s $1.15m.

Norwell worried about Auckland prices: “While this is a significant milestone, it raises serious questions around future affordability for Auckland residents wanting to get a foot on the property ladder.”

Ten regions had record median price surges in October.

Gisborne prices rose annually 34.1 per cent from $425,000 in October last year to $570,000 this October, Marlborough 26.8 per cent from $445,500 to $565,000, Otago 22.7 per cent from $532,000 to $652,500, Wellington 20.8 per cent from $650,000 to $785,000, Manawatu/Wanganui 17.5 per cent from $400,000 to $470,000, Northland 16.5 per cent from $515,000 to $600,000, Bay of Plenty 16.2 per cent from $620,000 to $720,500, Waikato 15.9 per cent from $565,000 to $655,000 and Canterbury 9.7 per cent from $465,000 to $510,000 this October.

Nationally, agents sold the highest number of properties in 53 months. Annually, volumes rose 25 per cent from 7063 sales to 8830 sales. REINZ said that was the highest number of properties sold since May 2016 and the highest October sales count since October 2006, or in the last 14 years.

Norwell said: “New Zealand’s housing market is extremely buoyant at the moment, with more than 8,800 properties sold around the country – that’s more than 283 properties sold every day in October. The last time we saw sales volumes of this magnitude was back in May 2016 when the market was very strong, and prices were rising across many parts of the country.”

The REINZ House Price Index for New Zealand, which measures changing values, increased 13.5 per cent annually to 3248. That is a new high for the index. The HPI for New Zealand excluding Auckland showed house price values increased 12 per cent from October 2019 to 3203 – also a new high.

Owen Vaughan, editor of NZME-owned property site OneRoof.co.nz, said: “While listings are up, the sheer volume of properties coming to market in recent months has not been enough to meet buyer demand, and yesterday’s LVR announcement by the Reserve Bank will only increase competition in an already intense market. Investors have upped their game and that has put the squeeze on first home buyers in some areas.

“OneRoof’s Property Report figures released at the start of the month show the house values in the majority of territorial authorities are up on where they were at the start of the Covid crisis. Together with REINZ’s latest data, they paint a picture of a booming property market,” Vaughan said.

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