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Record median house prices in Kapiti Coast, Porirua, Masterton and South Wairarapa

News from Real Estate Institute Of New Zealand
New Zealand rounded off the decade with the highest number of residential properties sold for the month of December in three years and price rises in 15 out of 16 regions, according to the latest data from the Real Estate Institute of New Zealand (REINZ), source of the most complete and accurate real estate data in New Zealand.

Wellington was a standout region in December, with four areas seeing new record median prices – Kapiti Coast District ($675,000), Masterton District ($477,000), Porirua City ($775,800) and South Wairarapa District ($625,000) showing the continued strength of the capital city’s property market.

The number of residential properties sold across New Zealand in December increased by 12.3% from the same time last year to 6,285 up from 5,596 (689 more properties). For New Zealand excluding Auckland, the number of properties sold increased by 5.8% when compared to the same time last year (to 4,425 up from 4,184) – the highest for the month of December in 3 years.

In Auckland, the number of properties sold in December increased by 31.7% year-on-year (to 1,860 up from 1,412) – the highest number of residential properties sold in the month of December since December 2015.

Regions outside Auckland with the highest percentage increase in annual sales volumes during December were:

• Bay of Plenty: +21.5% (from 414 to 503 – 89 more houses) – the highest for the month of December in 4 years
• Southland: +18.3% (from 126 to 149 – 23 more houses) – the highest for the month of December in 3 years
• Northland: +17.3% (from 173 to 203 – 30 more houses) – the highest for the month of December in 3 years
• Canterbury: +16.1% (from 776 to 901 – 125 more houses) – the highest for the month of December in 3 years.

Four regions saw decreases in annual sales volumes during December:

• West Coast: -43.5% (from 46 to 26 – 20 fewer houses) – the lowest since April 2017
• Gisborne: -18.5% (from 54 to 44 – 10 fewer houses) – the lowest for the month of December in 5 years
• Manawatu/Wanganui: -14.2% (from 351 to 301 – 50 fewer houses) – the lowest for the month of December in 5 years
• Hawke’s Bay: -1.4% (from 213 to 210 – 3 fewer houses).

Bindi Norwell, Chief Executive at REINZ says: “The property market had a solid end to the decade with a 12.3% increase in the number of properties sold in December 2019 when compared to December 2018. That’s an additional 22 houses sold each day around the country in December, which is not an insignificant number. With insufficient properties on the market to satisfy buyer demand, it suggests that buyers are being more definitive when it comes to purchasing as they are aware of the need to move quickly on properties and areas with high demand. This is backed up by the decrease in the median number of days to sell which is at its lowest point for 3 years.

“Looking around the country, 12 out of 16 regions saw annual increases in the number of properties sold – the highest number of annual increases in 3 months – with particularly strong increases in Auckland, the Bay of Plenty, Southland, Northland and Canterbury.”

Median house prices across New Zealand increased by 12.3% in December to $629,000 up from $560,000 in December 2018 and just $1,000 off last month’s record of $630,000. Additionally, five regions saw new record median prices. Median house prices for New Zealand excluding Auckland increased by 11.5% to a record equal of $535,000, up from $480,000 in December last year, but the same price as November 2019.

In Auckland, median house prices increased by 3.5% to $890,000 – up from $860,000 at the same time last year – and was the highest price for the region in 33 months. These results are in line with the REINZ House Price Index (HPI) which saw property values in Auckland increase 4.0% annually to a new record high of 2,931.

Record median prices were recorded in:
• Northland with a 12.3% increase to $539,000 up from $480,000 at the same time last year
• Manawatu/Wanganui with a 27.8% increase to $402,500 up from $315,000 at the same time last year
• Taranaki with a 14.1% increase to $430,000 up from $377,000 at the same time last year
• Tasman with a 12.5% increase to $655,000 up from $582,000 at the same time last year
• Southland with a 32.0% increase to $330,000 up from $250,000 at the same time last year.

The only region to experience an annual decrease in median price was the West Coast with a fall of -13.6% from $220,000 in December 2018 to $190,000 in December 2019 – the lowest price in 3 months.

“December saw 15 out of 16 regions with annual increases in the median house price and 5 regions with record median prices, reflecting the continued uplift in residential property prices that we’ve seen for a number of months now.

“Southland, Manawatu/Wanganui and Gisborne again saw really strong uplifts in price, with demand for properties in these regions outstripping supply and adding to the premium people are prepared to pay. There’s also likely to be an element of increasing vendor expectations adding to the price increases as month after month sellers in the region are reading stories of higher property prices,” continues Norwell.

“Looking at the Auckland region, Manukau City hit a new record median high of $900,000 in December, with Rodney District not far behind with a median of $890,000. North Shore City also saw a 7.1% annual uplift in median price, reaching $1,050,000 – the first time the median has been over the million-dollar mark in four months.”

REINZ House Price Index (HPI) reaches new record high for NZ and 10 regions

The REINZ House Price Index for New Zealand, which measures the changing value of property in the market, increased 6.6% year-on-year to 2,915 – a new record high.

The HPI for New Zealand excluding Auckland increased 8.9% from December 2018 to 2,902 another new record high.

The Auckland HPI increased by a solid 4.0% year-on-year to 2,931 a new record high and the second consecutive positive annual increase in 15 months.

In November, Southland again had the highest annual growth rate with a 20.6% increase to 3,292 a new record high. In second place was Manawatu/Wanganui with an annual growth of 19.2% to a new record high of 3,408 and again in third place was Gisborne/Hawke’s Bay with a 13.8% annual increase to a new record high of 3,022 – only the second time Gisborne/Hawke’s Bay has gone over the 3,000 mark.

In December, 10 out of 12 regions reached record high HPI levels; the only exceptions were Taranaki (+10.4%) and Canterbury (+2.9%) showing the overall strength of the property market.

Days to Sell decreases both YOY and MOM

In December the median number of days to sell a property nationally decreased by 4 days from 35 to 31 when compared to December 2018 – the lowest days to sell in 3 years. This figure was 2 days fewer than November 2019’s figure of 33 days.

For New Zealand excluding Auckland, the median days to sell decreased by 4 days from 34 to 30 – the lowest days to sell in 3 years. Auckland saw the median number of days to sell a property fall from 39 to 34 year-on-year – the lowest days to sell in 2 years.

Southland again had the lowest days to sell of all the regions at 21 days, down 2 days from the same time last year, but 3 days higher than November 2019’s figure which was the lowest median days to sell since August 2007.

December saw 6 regions with the median number of days to sell below the 28 mark, the highest number of regions with property selling that quickly since April 2017.

Northland had the highest days to sell at 45 days, down 3 days on December 2018, and down 2 days on November 2019’s figure of 47. The West Coast had the second highest median days to sell across the country at 41 days – down 35 days on the same time last year, and down 31 days on November 2019’s figure of 72.

Auctions

Auctions were used in 14.1% of all sales across the country in December, with 883 properties selling under the hammer – up from the same time last year, when 10.5% of properties (589) were sold via auction, but down on November 2019 when 16.8% (1,275) of all sales were via auction.

Gisborne again had the highest percentage of sales by auction across the country with 47.7% (or 21 properties) in the region sold under the hammer – up from 35.2% (19 properties) in December 2018.

Auckland saw the second largest percentage of sales by auction with 27.7% (515 properties) up from 18.7% in December 2018 (264 properties). The Bay of Plenty had the third highest percentage of auctions in the country with 13.3% (67 properties) sold under the hammer, down from 15.0% (62 properties) in December 2018.

Inventory

The total number of properties available for sale nationally decreased by -24.5% in December to 18,230 down from 24,158 in December 2018 – a decrease of 5,928 properties compared to 12 months ago and the lowest level of inventory since records began.

Again, all regions across the country saw an annual decrease in total inventory levels, with the largest percentage decreases in:

• Taranaki: -47.3% from 649 to 342 – 307 fewer properties and the lowest level of inventory since records began
• Southland: -40.6% from 529 to 314 – 215 fewer properties
• Marlborough: -33.1% from 366 to 245 – 121 fewer properties
• West Coast: -29.7% from 461 to 324 – 137 fewer properties.
Gisborne has the lowest number of weeks’ inventory with 5 weeks inventory available to prospective purchasers – the equal lowest inventory since records began.

This was followed closely by Wellington with 6 weeks’ inventory and Hawke’s Bay with 7 weeks’ inventory available to prospective purchasers.

The West Coast had the highest number of week’s inventory with 59 weeks’ inventory available to prospective purchasers – the highest in 14 months.

Price Bands

The number of homes sold for less than $500,000 across New Zealand fell from 41.6% of the market (2,327 properties) in December 2018 to 31.9% of the market (2,008 properties) in December 2019.

The number of properties sold in the $500,000 to $750,000 bracket increased from 29.9% in December 2018 (1,672 properties) to 33.1% in December 2019 (2,078 properties).

At the top end of the market, the percentage of properties sold for $1 million or more increased from 13.0% (726 houses) in December 2018 to 16.5% (1,039 houses) in December 2019.

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8 comments:

  1. KB, 16. January 2020, 13:32

    The Wellington region needs a big reworking of its density bylaws to allow much more infill housing and townhouse projects in many more suburbs. While the obvious answer is building up in the central city with high rises, the high earthquake risks make this a non-starter for a large portion of the population – and so much denser & smaller houses/townhouses are the likely solution to wellington’s soaring property prices. I myself would be happy to live in a 50-75sqm 1 or 2 bed house with a tiny section, but wellington’s zoning laws requiring high land-to-house ratios make it uneconomic to build these types of properties. There are tens of thousands of wellington houses on 300-700sqm sections that would be perfect to turn into very affordable 3 or 4 house properties – but bylaws make this impossible to do at present.

     
  2. Dan Tosfery, 16. January 2020, 16:20

    @KB – we just need to stop the growth in population. I don’t want to live in a shoe box or next to shoe boxes.

     
  3. Ian Apperley, 16. January 2020, 18:19

    I spoke to an agent this week and they told me the last house in Wgtn City they sold, Dec 19, went in two weeks, had 150 people through the open home, and 15 offers. [via twitter]

     
  4. TrevorH, 17. January 2020, 7:13

    @KB: After the Kaikoura quake three years ago it seems many people fled apartments to buy in the suburbs. A couple of houses in our street that were for sale in early 2017 were eagerly snapped up by refugees from the inner city. We have also seen a great deal of infill housing out East and it continues apace. Most long-term residents welcome it – Miramar these days has a pulse. But the elephant in the room is ever-increasing congestion which has been magnified by the public transport catastrophe visited upon Wellington by the GWRC. The refusal to do anything about the Mt Victoria/Basin Reserve bottleneck is also strangling the East and further large scale housing development is not wanted here, hence the opposition of many to the Shelly Bay proposal which would be a transport disaster in current circumstances.

     
  5. KB, 17. January 2020, 9:51

    @Dan Tosfery: I think many actually DO think it’s fine to live in “micro-sized” houses, driven by the popularity of the century-old workingmen’s cottages around the inner suburb, which often have a tiny footprint of 50-70sqm. Unfortunately many are on larger sections which can’t be subdivided easily under current bylaws. Lower Hutt has way better rules that encourage denser development. Just this week a one-house section on Cambridge Terrace near the railway station had a development of 8 x two-storey 1 & 2 bedroom townhouses starting at 50sqm in size with small private courtyards priced in the upper $400ks each. All townhouses were sold in less than 24 hours. Up to 20 people will now have their own affordable housing on a small site that previously had a single house on it.

     
  6. KB, 17. January 2020, 9:56

    @TrevorH: It is far far easier to fix transport issues than it is to fix housing issues. Shelly Bay has many problematic issues, but in terms of transport/congestion that is actually fairly easy to solve with high-frequency buses & ferries (who ensures that happens and who pays for it is the real problem, but might be as simple as adding a congestion fee to anyone using a car on the Shelly Bay road during peak times.)

     
  7. Dan Tosfery, 17. January 2020, 10:06

    I trust that the ‘unseen’ sewerage system will cope with the extra people you have in your suburbs TrevorH. Population induced infrastructure amplification will involve more than just transport.

     
  8. KB, 17. January 2020, 10:38

    @Dan Tosfery. There is a large development fee charged by the council for new dwellings which is supposed to pay for new infrastructure to support the new dwellings. Unfortunately I don’t think these are ring fenced by the council to actually use exclusively for infrastructure – but that is not the fault of developers.

     

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