New Zealand house prices have risen 3.8% in the last year but Auckland continues to be a “soft spot”, new REINZ figures show.
The Real Estate Institute of New Zealand House Price Index, released today, showed Auckland house values had climbed 0.9% in the past year. For the rest of the country, with Auckland excluded, house values increased 6.7%.
The median house price for the country was a record $560,000. The three most expensive areas were Auckland City with a median of $1,010,000, North Shore City ($975,000) and Queenstown Lake District ($908,000).
REINZ trumpeted the continued strength of the housing market saying 11 of 12 regions had experienced increases in the past year with only Canterbury declining – 1.1% year-on-year decrease.
Gisborne/Hawke’s Bay had the highest growth rate of 14.0%, followed by Otago and Southland with both regions seeing annual growth rates of 10.7%.
Westpac economist Satish Ranchhod said the national average was a “far cry” from the double-digit rates of price growth we saw in recent years.
“Underlying the softness in the nationwide figure has been a fall in prices in Auckland,” he said.
“Prices in Auckland fell 0.3% in June (adjusting for normal seasonal variations). That’s the fourth decline in as many months. Prices in the region have been tracking sideways for close to two years now, though the level remains elevated.”
Ranchhod said housing market conditions had been dampened by policy changes targeting property speculation.
“The Brightline test for taxing capital gains has been extended. Restrictions on foreign buyers of property are expected to come into force sometime next month. Then from early next year, the use of negative gearing by property investors will start to be phased out.
“We expect that these measures will weigh on price growth over the coming year, and are also likely to dampen people’s willingness to spend.”