Auckland asking prices increase $300,000 in five years
15 October 2015
Auckland asking prices increase $300,000 in five years
The average asking price for Auckland properties has risen $300,000 over the past five years according to the latest Trade Me Property Price Index.
Head of Trade Me Property Nigel Jeffries said that was an “extraordinary” amount. “Just when you think the Auckland property market can’t surprise you any further, another incredible statistic emerges. In September 2010, the average asking price for a property in Auckland was $476,000 and five years later it is $776,000.”
He said that between September 2010 and September 2013, the average asking price increased by $100,000 and then things have ramped up in the past two years. “Since September 2013 the average asking price has jumped by a further $200,000 which is a staggering amount of growth for any market. We saw a small dip in July but it was an exception and there has been an increase in the Index for 12 of the past 13 months.”
In the three months to September, average asking prices in Auckland rose 0.7 per cent, taking the annual rate of growth to 19.7 per cent, and the 5-year increase to 63 per cent.
Meanwhile outside of the Super City….
Outside Auckland the average asking price continues to stubbornly hover around the $400,000 mark. September saw a meagre 0.5 per cent increase in average asking prices, which put the annual growth at 3.8 percent. Mr Jeffries said that although this represents an extra $14,850 on average asking prices, this was “a far cry” from Auckland.
“Our largest city is charging on but it looks like the rest of the country has reached a plateau for now. There are some regions which are performing exceptionally well, but nationwide it’s pretty quiet. Over the last five years we’ve seen average asking prices for properties outside Auckland increase much slower than in Auckland – they’re up by almost $66,000 since September 2010 or 19 per cent. Of course this is still solid growth, but Auckland’s spectacular growth makes for an impossible yardstick.”
Mixed activity across the regions
It was a mixed bag in the regions with 10 recording growth in average asking prices in September and four recording falls. Waikato and Bay of Plenty continued to see strong growth in average asking prices off the back of what many are dubbing ‘the Auckland effect’ where potential Auckland home owners are looking to invest in more affordable neighbouring regions.
Waikato reported an expected selling price of $389,900, up 2.2 per cent in the month and taking the annual rate of increase for the region to 11.5 per cent. This has added $40,250 to the typical asking price of a Waikato property over the past year.
Similarly the Bay of Plenty rose 0.8 per cent in the month to $471,600, taking it to a new record high. In the past year the asking price has increased by 11.3 per cent or $48,000.
In contrast both Taranaki and Otago continue to see average asking prices declining. Otago has seen falls in seven of the past eight months. In September it recorded a 10.8 per cent decline in average asking price to $362,150.
“Otago seems to be experiencing a very tough time with average asking prices for property in the region well below prices in September 2010 when they were a shade under $400,000,” Mr Jeffries said.
Taranaki has also seen a significant decline in recent months. For ten consecutive months the average asking prices rose significantly, but that has reversed over the past two months. In September it was down 10.2 per cent to $329,650.
By house size
The demand for smaller homes has increased significantly around the country with an 18 per cent increase in the average asking prices for 1 -2 bedroom homes. Mr Jeffries said this has been heavily influenced by an increase of 22 per cent in Auckland where smaller homes are a more realistic option for many buyers.
Wellington is bucking the trend with medium-sized homes (3-4 bedrooms) seeing an increase in average asking price of 3.7 per cent in the last year, however large homes (5+ bedrooms) and small homes both saw declines in asking prices in the capital.
In Christchurch the market is stronger for larger properties with a 10.4 per cent increase in average asking prices over the past year to an average asking price of $803,800.
The Auckland market is a powerhouse of average asking prices with large homes up 18.4 per cent in the last year (+$182,000), medium-sized homes up 18.7 per cent (+$125,000) and small houses up 22 per cent (+$100,000).
Table 1: Average asking price by property size & region, September 2015 v September 2014
|All Properties||Large houses
Urban living continues to lead the market
Small urban properties remain popular, led by an Auckland market where buyers are looking at a number of options outside the usual quarter acre section to get on the property ladder.
“The average asking price across the country for apartments, townhouses and units is now over half a million dollars but this is skewed by Auckland’s market where urban properties are now expected to sell for well over $580,000,” Mr Jeffries said.
Units in Auckland continue to show accelerated growth in expected selling price. In September the expected selling price reached a new high of $552,950, having pushed past the $500,000 mark for the first time in May 2015. The past year has seen an extra $113,950 added to the average asking price for an Auckland unit, a 26 per cent increase.
“Over the past five years the average asking price for what was once thought of as a humble unit has grown by more than 75 per cent from $310,200 to just over $550,000,” Mr Jeffries said.
Table 2: Average asking price by property type & region, September 2015 vs September 2014
|All Urban Properties||Apartments||Townhouse||Units|