Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Home affordability still falling

Home affordability still falling

Home affordability declined again in the three months to September 30, despite a slowdown in the growth of house prices in the same period.

The latest report from the Massey University Real Estate Analysis Unit also shows that affordability in the Central Otago/Lakes district declined by nearly 30 per cent in the year to September, four times the national rate.

Other key points in the report:

House prices still dominate the affordability equation
Auckland affordability improves a little
Central Otago/Lakes is the least affordable region
Southland is the most affordable region.

During the September quarter home affordability declined by 1.4 per cent. Property Studies director Professor Bob Hargreaves says this represents the 17th consecutive quarter in which the national index has declined.

The measure is driven by three variables: house prices, wage rates and mortgage interest rates. Professor Hargreaves says the continuing decline in affordability appears to owe most to the fact that wage increases have not been high enough to compensate for house price and interest rate rises. However the 1.4 per cent decline for the September quarter is lower than the 2 per cent reported for the June quarter.

Professor Hargreaves says on a regional basis the quarterly results were a mixed bag, with the main driver being differential changes in house prices.

Affordability improved in five regions and declined in seven. Leading regions with improved affordability were Northland (8.2 per cent), Auckland (1.1 per cent) and Otago (1.2 per cent). Leading the declines were Central Otago/Lakes (6.8 per cent), Wellington (5.6 per cent), Manawatu/Wanganui (5.4 per cent). Professor Hargreaves says these results appear to be largely a result of regions being at different stages on the property cycle.

Over the year to September, national affordability declined by 6.9 per cent. This was again largely driven by house prices increases of 6.9 per cent outstripping increases in wages (3.5 per cent) and increases in the weighted average interest rate on home mortgages (3.5 per cent). All regions posted annual declines in affordability.

The largest regional annual decline was in the Central Otago/Lakes region (28.9 per cent) followed by Manawatu/Wanganui (16.6 per cent) and Nelson/Marlborough (16.0 per cent).

The smallest regional annual decline was Hawkes Bay (0.8 per cent) followed by Canterbury Westland (3.6 per cent) and Auckland (5.1 per cent).

Southland remains the most affordable region with the index now at 51.7 per cent of the national benchmark of 100 per cent. Manawatu/Wanganui, with an index of 71.8 per cent, stays in second place, followed by Otago (74.4 per cent). Central Otago Lakes is still the least affordable area with an index of 161 per cent followed by Auckland on 121.8 per cent.

The full report on home affordability for the September quarter, including graphs, is available at http://property-group.massey.ac.nz

The graphs include an illustration of the relative movements in home affordability for New Zealand, Auckland and Southland over the last decade.

Ends


© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

 

Wellington: Predator Free Capital Plan

Wellington City Council (WCC), the Greater Wellington Regional Council (GWRC) and NEXT Foundation, today announced a joint collaboration to make Wellington the first Predator Free capital city in the world. More>>

ALSO:

Gordon Campbell: On Judith Collins’ Efforts At Self Correction

Thousands of prisoners currently in prison may be entitled to an earlier release than expected – and compensation – because Corrections has incorrectly calculated their term of imprisonment. Unless of course, the government buries its mistakes by changing the law and retro-actively getting itself off the hook… More>>

ALSO:

More Justice & Corrections

Sector Opposes Bill: Local Government Bill Timeframe Extended

The Minister of Local Government Peseta Sam Lotu-Iiga has asked the Select Committee to extend the report back date for the Local Government Act 2002 Amendment Bill (No 2). More>>

ALSO:

Breed Laws Don’t Work: Vets On New National Dog Control Plan

It is pleasing therefore to see Louise Upston Associate Minister for Local Government calling for a comprehensive solution... However, relying on breed specific laws to manage dog aggression will not work. More>>

ALSO:

Not Waiting On Select Committee: Green Party Releases Medically-Assisted Dying Policy

“Adults with a terminal illness should have the right to choose a medically assisted death,” Green Party health spokesperson Kevin Hague said. “The Green Party does not support extending assisted dying to people who aren't terminally ill because we can’t be confident that this won't further marginalise the lives of people with disabilities." More>>

ALSO:

General Election Review: Changes To Electoral Act Introduced

More effective systems in polling places and earlier counting of advanced votes are on their way through proposed changes to our electoral laws, Justice Minister Amy Adams says. More>>

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news