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Festive cheer for first-time buyers


Wednesday, December 17, 2008
Festive cheer for first-time buyers

First-time buyers will be cheered by the news that national home affordability has improved 4.6 per cent in the past year, according to the latest figures from Massey University.

It is now much easier to get onto the housing ladder in Southland with affordability – a measure that factors in average prices, pay and interest rates – improving by 21.2 per cent.

Other regions showing improved affordability are Wellington (7.4 per cent), Waikato/Bay of Plenty (6.4 per cent), Auckland (5.9 per cent), Canterbury/Westland (5 per cent) Otago (4.9 per cent) and Taranaki (4.5 per cent).

Manawatu/Wanganui (0.1 per cent) remained stable, while declines in affordability affected Central Otago Lakes (18.4 per cent) followed by Hawke’s Bay (5.6 per cent), Northland (1.9 per cent) and Nelson/ Marlborough (1.9 per cent).

Central Otago Lakes remains the least affordable region, followed by Auckland and Nelson/Marlborough.

Southland is the most affordable region, followed by Otago and Manawatu/Wanganui.

In the past quarter, a 2.2 per cent increase in the national median house price has outweighed the 1 per cent increase in wage rates and static interest rates, resulting in a 1.4% overall deterioration in affordability.

But Professor Bob Hargreaves, Director of the Massey University Real Estate Analysis Unit, says not to read too much into this surprise statistic.

“The median house prices statistic may be skewed upwards due to stricter lending criteria leading to reduced sales volumes for lower cost homes,” he said.

Over the last quarter, six of the twelve regions showed improved affordability; Southland (10.3 per cent) Waikato/Bay of Plenty (5.7 per cent), Otago (4.8 per cent), Wellington (2.5 per cent), Auckland (0.7 per cent) and Manawatu/Wanganui (0.7 per cent).

Regions showing declines in affordability were Northland (11.9 per cent) Hawke’s Bay (8.7 per cent), Central Otago/Lakes (7.4 per cent), Taranaki (5.1 per cent), Canterbury/Westland (2.8 per cent) and Nelson/Marlborough (2.6 per cent).

The December quarterly survey of the Massey University Home Affordability Report is available at: http://property-group.massey.ac.nz/

ends

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