National property values have steadied according to the QV residential property index for July.
“Nationwide property values have steadied over the past month and are now only 0.4% below the same time last year, and remain 5.2% below the market peak of 2007” said QV.co.nz Research Director Jonno Ingerson.
“Over the past three months values have increased in many parts of the country, with particular strength in the Canterbury region and parts of Auckland” said Ingerson.
“Across the wider Auckland area values have increased 2.4 percent since January, and as a result are now 1.9 percent above last year and only 0.6 percent below the previous market peak of late 2007. This growth in values over the past few months has not been evenly spread across the Supercity with the old Auckland City growing the most, modest increases in Rodney, North Shore and Waitakere, while Manukau, Papakura and Franklin have stayed more or less stable” said Ingerson.
“Values in Hamilton, Tauranga and Dunedin have all been relatively stable for the past six months, although declines in the six months prior to that mean that all three areas remain below the same time last year” said Ingerson.
Ingerson said “Wellington remains the only main centre where values continue to decline in recent months, dropping 1.8 percent since January, and now sitting 2.7 percent lower than the same time last year. Possible Public Sector restructuring remains a dampening factor in the property market”.
“Values in Christchurch have been volatile since the first earthquake in September, first increasing for a few months, then dropping prior the February quake, and since then have been increasing. Over the past three months values across Christchurch have grown 1.1 percent, and are now 0.5 percent above the same time last year. The increase in recent months is due to increased demand for properties in undamaged areas particularly in the West and North of the City” said Ingerson.
Ingerson said “values across the rest of the Canterbury Region have also increased in recent months due in part to demand from displaced Christchurch residents. Values in Ashburton have grown the most at 4.0 percent over the last three months. Waimakariri District immediately North of Christchurch has increased 2.9 percent and Selwyn District immediately to the West has increased 2.1 percent.”
While unrelated to the QV index, and a less reliable measure of value change, the average New Zealand sales price over the last three months is $414,261 up slightly from the $412,746 reported last month.
The provincial centres have seen some variability in values in recent months with some dropping, others rising and others staying flat. However values in most provincial towns remain below the same time last year. Wanganui is the furthest below last year at -6.8 percent, with Gisborne next at -4.6 then Invercargill at -4.0. Whangarei (-2.7), Rotorua (-2.9), Hastings (-1.0%), Napier (-1.5), New Plymouth ( 2.6) and Palmerston North (-1.0) are all down slightly on last year. Nelson values are at the same level as this time last year while in Queenstown Lakes values are 1.5 percent above last year.
Main urban commentary
Auckland
QV’s Residential Price Index for July shows that property values in the Auckland region are 1.9% higher than the same time last year. Values continue to increase although not as quickly as last month.
Ms Glenda Whitehead of QV Valuation said; “Auckland is an extensive region and while values sit 1.9% above a year ago, when you look at each area this reflects too little for some and too much for others. We are seeing local influences at play within each of the former cities, their suburbs, that even go down to street and property level. These are driving much of the shift in value with most of the upward price movement within the former Auckland City.”
“Values for former Auckland City show an annual growth close to 3%. Whilst there has been some steady growth our valuers have seen some spiky values being achieved for individual properties that tick all the boxes. While other more homogenous type properties or those with faults have shown little value movement” Ms Whitehead said.
Ms Whitehead said “we continue to see strong demand based on both locality and building type. This has seen value rises in the older traditional suburbs such as Royal Oak, Epsom, Mt Eden, Mt Albert, and other suburbs in close to proximity to the CBD. These leafy suburbs offer popular school zones, village atmospheres, and large numbers of character homes or homes built with trusted and proven building materials.”
“In terms of other parts of the region there is little to report that was not said in prior months. Values levels remain stable, as reflected by the limited change in the underlying index for the past year to 18 months” Ms Whitehead said.
Ms Whitehead said “There are definitely two distinct speeds prevalent across the region. It is a seller’s market in the leafy inner city suburbs, while elsewhere we have greater balance between listing levels and number of buyers.”
“We are in the depths of winter now, so we expect listing levels to increase from now onwards. We may see some vendors hold off until after the election, somewhat of a pattern noted around previous election years, but realistically, the result is unlikely to have any direct impact on the property market, it’s just another reason to stall” Ms Whitehead said.
QV’s Residential Price Index is calculated using sales data from the 3 months leading up to the month being reported. It is not the same as the average sales price, which fluctuates in line with the mix of properties selling in upper or lower price brackets. The average sales price for the Auckland region in July was $541,357.
Hamilton
QV’s Residential Price Index for July shows that property values in Hamilton are 3.4% lower than the same time last year. Values in recent months are remaining fairly steady.
Mr. Richard Allen of QV Valuations said: “Values have oscillated in a very narrow band. Although Hamilton remains subdued there is some evidence to suggest that things may be picking up a little.”
“There are variations in the property growth across the different localities within Hamilton City. Central City/North West decreased slightly, whilst South West Hamilton, which has been fairly static moved in a positive direction this month. The North East and South East Hamilton values also increased” Mr. Allen said.
QV’s Residential Price Index is calculated using sales data from the 3 months leading up to the month being reported. It is not the same as the average sales price, which fluctuates in line with the mix of properties selling in upper or lower price brackets. The average sales price for Hamilton in July was $340,225.
Tauranga
QV’s Residential Price Index for July shows that property values in Tauranga are 1.7% lower than the same time last year. Values in recent months continue to be steady.
Mr. Shayne Donovan-Grammer of QV Valuations said; “There has been no significant changes to the Tauranga market over the last month or two. Feedback from real estate agents suggests there is a shortage of listings for central, tidy, lower to mid value properties.”
“I am seeing an uplift in first home buyer activity. They are encouraged by the continuation of low interest rates, a relaxing of credit criteria and the odd seller more than willing to compromise. Second home buyers and investors are more reluctant to enter the market with many not having the appetite to take on more debt in what is a constrained market” Mr. Donovan-Grammer said.
Mr. Donovan-Grammer said “for the buyer who is willing to put in the leg work there are some good buys out there presently.”
QV’s Residential Price Index is calculated using sales data from the 3 months leading up to the month being reported. It is not the same as the average sales price, which fluctuates in line with the mix of properties selling in upper or lower price brackets. The average sales price for Tauranga in July was $432,461.
Wellington
QV’s Residential Price Index for July shows that property values in the Wellington region are 2.7% lower than the same time last year. Values in recent months continue to decrease.
Mr Kerry Buckeridge of QV Valuations said “As has been the case for some time now the Wellington market continues to be very slow. Though there has been a noticeable increase in activity over the last week – coinciding with the end of the school holidays.”
“The busiest segment continues to be at the more modestly priced/first home buyer end of the market. With prices lower than at the market peak and historically low interest rates it can be argued a first home is currently more affordable than it has been for many years” Mr Buckeridge said.
Mr Buckeridge said “More and more are commenting there is a shortage of good stock in the mid to upper price segments. This may be reflective of the fact that those that traditionally looking to upgrade have stayed out of the market over the last twelve months or so. If this situation continues it is possible that good quality offerings may once again begin to attract multiple offers and higher prices – we shall see! Thus far buyers continue to be very cautious.”
QV’s Residential Price Index is calculated using sales data from the 3 months leading up to the month being reported. It is not the same as the average sales price, which fluctuates in line with the mix of properties selling in upper or lower price brackets. The average sales price for Wellington in July was $438,974.
Christchurch
QV’s Residential Price Index for July shows that property values in Christchurch are 0.5% higher than the same time last year. Values have fluctuated over the last year due to the affects of the earthquakes. In recent months values have been growing steadily, probably driven by higher demand in undamaged areas, such as in the North and West of the city.
Mrs. Melanie Swallow of QV Valuations said; “House prices appear to have shown a slight recovery in the aftermath of the 13 June earthquake. The delay in activity as a result of earthquakes was expected and now some signs of normality can be seen emerging. There are more buyer enquiries and open home attendance, along with foot traffic through new show homes. Although the signs are encouraging we need to treat it all with some caution due to the fragmented market and low sales volume.”
“An increase in demand for properties in relatively unaffected suburbs is exactly what we expected to see. Overall, sale prices appear to have held, even in the eastern suburbs, however this could be influenced by the low sales volume. We expect to see some traction in the market over the next two months” Mrs. Swallow said.
Mrs. Swallow said “there is strong interest overall for well priced quality homes in suburban Christchurch at present, this continues to be evident in the North West and South West suburbs as well as the main Selwyn and Waimakariri townships and Christchurch’s North and Western suburbs.”
“The increase in activity, particularly buyer enquiry is being driven by those in red zone areas. They will be evaluating their options and testing the waters in anticipation of future property decisions. Whilst this will be a gradual process we expect to see continued pressure in the interim on the affordable housing market” Mrs. Swallow said.
QV’s Residential Price Index is calculated using sales data from the 3 months leading up to the month being reported. It is not the same as the average sales price, which fluctuates in line with the mix of properties selling in upper or lower price brackets. The average sales price for Christchurch in July was $386,279.
Dunedin
QV’s Residential Price Index for July shows that property values in Dunedin are 2.9% lower than the same time last year. Values continue to fluctuate in a narrow band.
Mr. Tim Gibson of QV Valuations said: “The Dunedin residential property market continues to remain subdued. The winter months have traditionally always been a slow period for residential activity as listings and potential purchasers hold off from entering the market until spring.”
“Whilst values are fluctuating slightly from month to month, overall they are holding steady after a period of decline in the latter period of 2010” Mr. Gibson said.
Mr. Gibson said “with new listing volumes and average listing price down combined with lower buyer interest, it appears these conditions may continue in the short term within the Dunedin residential market.”
“Overall reasonable demand still exists for well presented properties in sought after localities. It is values for properties with maintenance requirements that are being affected more in the slow market. They often have longer selling periods and greater discounting is required in order to secure a sale. It is typically potential buyers being more selective in their decision making. They are not being rushed with factors such as multiple offers on properties, which was common during better market conditions” Mr. Gibson said.
QV’s Residential Price Index is calculated using sales data from the 3 months leading up to the month being reported. It is not the same as the average sales price, which fluctuates in line with the mix of properties selling in upper or lower price brackets. The average sales price for Dunedin in July was $273,335.
