National Property Prices Grow By Nine Percent In One Year
New Zealand property prices saw their biggest year-on-year increase in over three years in July, according to the latest Trade Me Property Price Index.
Trade Me Property spokesperson Aaron Clancy said the national average asking price reached $697,100 last month – a 9 per cent increase when compared with July 2019. “The last time we saw such a large increase was in May 2017, when the national average asking price increased by 10 per cent year-on-year to $640,750.”
Mr Clancy said prices were driven up, in part, by heightened demand. “Following the same pattern as the previous three months, we saw an increase in demand for property across the country in July.
“While we’re not seeing the feverish demand that peaked in May, after buyers came out of lockdown, it was still up by 20 per cent when compared to July in 2019.”
Comparatively, Mr Clancy said market supply was not keeping up. ”The number of properties available for sale in July was down 4 per cent when compared with July 2019. This will be putting pressure on house hunters, pushing them to make bigger offers and bumping up house prices even more.
“It’s a very good time to sell if people are considering it, there are a lot of keen buyers in the market and not enough houses for sale to keep up.”
Looking ahead, Mr Clancy said Kiwis appeared to be optimistic about the property market for the rest of the year. “A survey of over 1,700 of our members conducted in the last week of July showed 62 per cent expected property prices will increase or remain the same in the last quarter of 2020.”
“The survey results also showed the upcoming election was not a major concern for many prospective property buyers and sellers, with eighty-two per cent of participants saying the timing and result of the election will have no impact on their intention to buy or sell.”
“Obviously, with the election date now set, and Auckland entering alert level 3, time will tell whether Kiwis will hold onto this positive outlook.”
Auckland prices climb by 8% year-on-year
Prior to entering Alert Level 3, Mr Clancy said property price growth in the Super City was showing no signs of slowing down. “The July asking price in the Auckland region was up by 7.8 per cent when compared with July last year, sitting at $943,950. In Auckland City, the average asking price was $1,088,250 - a 9 per cent increase on the same month in 2019.
Mr Clancy said the region saw the same increase in demand and slow supply as the rest of the country. “The total number of properties available for sale in the Auckland region was down by 5 per cent when compared to July last year, while listing views were up by 23 per cent.”
“Time will tell whether prices in the region continue to follow nationwide price trends, or the regional lockdown results in unique property market activity patterns in Auckland. Obviously, we expect to see a slightly different story in Auckland during August, with level 3 restricting movement, but hopefully the market will bounce back quickly once again when the region enters lower alert levels.
Property prices in the Capital saw similar rates of growth in the month of July. “The average asking price in the Wellington region was $688,200, 8 per cent higher than July last year when it was $636,250. In Wellington City alone, the average asking price was up 9 per cent year-on-year, at $808,250.”
Property prices increased in all districts within the Wellington region in July. “Carterton, Kapiti Coast, Lower Hutt, and Masterton all saw double-digit growth when compared to this time last year.”
Echoing the rest of the country, Wellington market supply was down, while demand was up. “The number of properties for sale in the Wellington region was 12 per cent lower than July last year. Demand in the capital is still massive, up 23 per cent when compared to July 2019 .”
Double-digit growth in the regions
Mr Clancy said average asking prices increased across every region in July, with three seeing record-breaking months. “Average asking prices were at all-time high in Hawkes Bay ($605,900), Manawatu/Whanganui ($453,600) and Northland ($630,650).”
Small house prices see big growth
All house types across New Zealand experienced year-on-year growth in July, but no new highs were reached. “Small house (1-2 bedroom) prices saw big year-on-year growth across the country, up by 14 per cent in both Auckland and Wellington, and up by 16 per cent nationwide.”
Apartments, townhouses and units all saw price increases in July across the country. “Wellington apartments had a record-breaking month, with their average asking price reaching a new high of $642,650 – up 20 per cent when compared with July 2019.”