It remains to be seen whether this is part of a wider slowdown, says REINZ
New Zealand’s “two tiered” market has continued into 2019, with January seeing 14 out of 16 regions achieve annual median price increases while Auckland and Canterbury prices fell.
According to the Real Estate Institute of New Zealand (REINZ), January median prices increased by 5.8% nationwide, rising to $550,000. Prices excluding Auckland went up by 10.1% to $473,000, and five regions achieved record median prices.
Auckland meanwhile saw its lowest median price since February 2016, falling -2.4% to $800,000 from $820,000 year-on-year. REINZ chief executive Bindi Norwell says that the market will be ‘watching closely’ to see whether the slowdown is part of a typical New Year lull, or if it is the start of a broader decline.
“January has pointed to a two-tier market continuing around the country with Auckland and Canterbury experiencing a slowdown in price, but the rest of the country has seen strong price growth, including five regions achieving record median prices,” Norwell stated. “This increase in price once again highlights how the lack of supply is continuing to push up house prices; therefore, it’s essential that as a country we address this fundamental issue sooner rather than later.”
“From an Auckland perspective, the median house price in January of $800,000 was the lowest we’ve seen for 35 months with falls across Franklin, Rodney, North Shore and Papakura districts during the month ranging from -0.7% to -13.2%,” she explained.
“However, Auckland City, Manukau City and Waitakere City all saw annual increases of between 1.5% and 9.5% showing that there are pockets of growth occurring across the region.
December and January usually see prices decline and then pick up again in February and March, so we’ll be watching closely to see whether this is just the usual Christmas/New Year slowdown or whether this is the start of something wider. What we can say, is that it’s too early to call this a trend and it’s too early to confirm whether the Auckland market has actually turned,”
The REINZ House Price Index increased by 3.1% year-on-year, and the median number of days taken to sell a property increased to its highest level since February 2012. Properties sold for less than $500,000 fell by 5% since January 2018, while properties sold in the $500,000 - $750,000 bracket rose by 4.2%. Properties sold for $1 million+ decreased by 9.0% year-on-year.
