Thursday, 09 May 2013
Optimism across the country
The latest monthly property value index shows that nationwide residential values increased further in April. Values are up 4.0% above the previous market peak of late 2007, with a 1.3% increase over the past three months and a 7.1% increase over the past year.
Kerry Stewart, QV Operations Manager said “the increase in nationwide values is now being driven by all the main centres, not just Auckland and Canterbury. The value increases in the other main centres is much slower than in Auckland and Canterbury, but the trend is definitely positive. The provincial centres remain more variable.”
“Buyers are showing more optimism and confidence, although are still being careful in their decision making. The exception to this is in parts of Auckland where demand is so high that there is little opportunity to delay making offers.” said Stewart
Main Urban Areas Commentary
NOTE: On the urban graph, we have added the New Zealand Price Index line (shown in light blue) to provide a comparison between that area and New Zealand overall.
Values across Auckland have continued to increase and are now up 12.0% over the past year. Rodney and old Auckland City still show the slower rates of growth over the past 3 months in comparison to other areas. Old Auckland City for example has seen a 1.7% increase over the past 3 months where as other areas are increasing by 2-3%. Waitakere has seen the highest increase at 3.4%. Overall, values are still markedly above last year, with North Shore, old Auckland City, Waitakere and Manukau all around the 12% mark.
QV Operations Manager Kerry Stewart said “with the continued surplus of buyers and lack of properties on the market to meet the demand prices are still increasing. We have seen instances of some properties selling for hundreds of thousands of dollars above their Rating Value.”
“As a result, buyers are broadening their property search to areas away from desirable suburbs and looking more at the fringe of the city. Again, this is causing prices to increase rapidly with areas such as Blockhouse Bay and New Lyn achieving prices previously unseen for years,” said Stewart.
“Even properties in the higher end of the market, in excess of $4 million, have been selling extremely well lately with over 50 properties sold in this range in the last 12 months,” said Stewart.
Hamilton and Tauranga
Outside of Auckland, the main cities are still increasing. There is renewed confidence in areas such as Tauranga, where growth has been limited in comparison to other major cities like Auckland and even Hamilton. As a result, Tauranga has grown 1.2% over the past 3 months, with Hamilton seeing only a slight increase on that at 1.7%. Tauranga remains only 0.8% above this time last year however in comparison to Hamilton's growth of 4.9%.
QV Valuer Paul Thomas said “there is a growing feeling of confidence in Tauranga following a strong month of sales and plenty of interested buyers. There are some indications that Aucklander's are moving down to the city to work, something that has been notably absent for the past few years. This may help the market lift even further.”
QV Valuer Richard Allen reiterated this optimism by saying “sales are ticking over well with enough demand in the market. The drought especially doesn't appear to have had any negative impact at this stage. Hamilton could also reap the benefits of some proposed developments in the dairy industry nearby.”
Values in the Wellington area are showing some growth, although not like the other large cities of Auckland and Christchurch. Values are now 2.0% above this time last year with a 0.8% growth in the last 3 months. Within Wellington, Porirua has seen the biggest increase over the last 3 months at 2.2%.
QV Valuer Kerry Buckeridge said “buyers in the $1-1.5 million bracket as well as first home buyers remain active in the market with attractive, well presented properties attracting multiple offers and selling well. There are quite a few apartments on the market but with insurance increases affecting body corporate fees still, sales aren't as prolific in many buildings.”
Christchurch and Dunedin
Christchurch values also continue to increase, now 9.4% above last year. The outlying areas such as Waimakariri and Selwyn continue have continued to show slowing growth rates, although are still significantly above last year also at 6.5% and 13.2% respectively.
QV Valuer Daryl Taggart said “good sales are continuing with buyers seemingly determined to get the house at any price, especially if they have been searching for a while. We are also seeing sales increase in the hill suburbs with stigma perhaps starting to decrease about these areas.”
Dunedin has also seen another steady increase with it now up 1.1% increase over the past 3 months, and 4.8% up on last year.
QV Valuer Tim Gibson said “the normal winter slowdown hasn't taken affect yet with sales volumes good. There does appear to be a lack of properties however across most of the market, meaning any well presented properties, especially in sought after locations, are sold quickly and usually with multiple offers.”
The provincial centres are fluctuating but generally the market remains stable with the main areas continuing to grow. Areas such as Hawke's Bay and Wairarapa are witnessing some optimism as per other areas of the country but buyers remain cautious and are still taking their time. Even areas like Whangerei, which has previously been declining, have experienced a slight increase of 0.2% over the past 3 months.