Housing data shows a market upturn is still underway with national property values up 3.9% on last year – and up 6.9% outside Auckland.
Westpac senior economist Michael Gordon said the February REINZ housing report showed a further modest strengthening in the housing market.
The REINZ house price index said Auckland house prices were up 1.1% on a year ago, while prices in the rest of the country were up 6.9%.
The housing market cooled over the first half of 2017, before a gradual recovery in the second half. Gordon said the January Real Estate Industry figures had suggested that the housing market’s upturn might be running out of puff, however, the data for February indicates that the upturn remains on course.
REINZ chief executive Bindi Norwell said median house prices had increased in 14 out of 16 regions during February 2018 compared to February 2017, including a record high in the Hawke’s Bay.
“The Hawke’s Bay has seen record price increases for two months in a row now, with prices having increased $26,000 since the end of 2017. Clearly the region is proving extremely popular.”
Norwell said Auckland’s “moderated” growth was far more positive for the region as the double digit growth seen in 2016 and 2017 was not sustainable in the long term.
The REINZ figures showed that along with prices, the number of properties for sale had increased by 3.2%. This was driven by reasonably large inventory increases in Waikato (15.0% increase) Auckland (10.9%) and Canterbury (10.7%).
Gordon said lower mortgage rates and an easing of the Reserve Bank’s loan-to-value ratio restrictions had helped to support the housing market in recent months.
Gordon said Westpac economists still expected house prices to flatten out over 2018 as new government policies started to bite.