Property market report
National house prices rose less than 1 per cent from May to June and sales volumes dropped 5 per cent. Real Estate Institute data showed May’s median prices of $817,500 rose marginally to $820,000 in June, up just 0.3 per cent. Sales numbers fell from 7720 sales nationally in May to 7345 sales last month.
Auckland’s median rose only 0.2 per cent, from $1.14m to $1.15m and sales volumes also fell 2.4 per cent from 2834 to 2766.
Rising house prices through the country are certainly one of the main drivers for the Reserve Bank’s decision to increase the OCR.
Michael Gordon, Westpac’s acting chief economist, said the current data “showed that the New Zealand housing market remains strong, but is cooling off relative to its white-hot pace at the start of this year. Sales were broadly flat, while prices rose at a slower pace than in previous months.
“We estimate that June sales are down about 1 per cent in seasonally adjusted terms. Sales are still running above pre-Covid levels, and indeed they were still higher than in June last year, which marked the start of the post-lockdown rebound in activity,” Gordon said.
The return of loan-to-value restrictions and the recent tax changes have contributed to some cooling-off of demand for investment properties, although the evidence to date suggests that homebuyers have been quite willing to step into the gap created, he said.
“That could change once mortgage rates, in particular the one and two year fixed rates, start to rise from their lows, as the prospect of OCR increases loom, Gordon said.
“For some time, the Reserve Bank has been holding off on bringing out interest rate hikes to tackle the housing price increases, because the rest of the economy wasn’t ready for higher interest rates. Now it is,” Jones said.
“We’d expect mortgage rates to start rising in advance of this, flipping what has been a tail wind for house prices into a slight headwind. We’ll get an update on the Reserve Bank’s thinking,” Jones noted.
Jen Baird, REINZ chief executive, said median prices increased by 28.7 per cent from $637,000 in June 2020 to $820,000 last month.
“Additionally, five out of 16 regions reached new record median prices, one region saw an equal record and 20 districts reached new record median highs,” Baird said.
The median house price for Auckland rose 25% year on year to June 2021 to reach $1,150,000.
Let’s look at the values locally:
Herald Island $890,000 to $2,900,000
Hobsonville $556,000 to $3,250,000
Massey $735,000 to $1,400,000
Swanson $1,235,000 to $1,450,000
West Harbour $849,000 to $1,500,000
Westgate $942,500 to $1,150,000
Whenuapai $820,000 to $1,220,000
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McIntyre today on 027 632 0421 or email firstname.lastname@example.org - Mike Pero Real Estate Ltd Licensed REAA (2008).
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