Price drop: Half of Auckland suburbs hit
Auckland’s property market is losing its golden sheen. Almost half of its suburbs dropped in price in the three months to September. New figures out today show 80 of 168 suburbs in the Auckland region saw values drop in the third quarter. However, QV national spokeswoman Andrea Rush said the latest QV Property Report showed that despite a drop in some areas there was still growth in the housing market. “Eighty-two saw values drop in the year to September so this means more than half of the suburbs in Auckland saw values increase or remain [steady] in that same time frame.
“This illustrates how mixed the market is and it’s not correct to say that all areas of the market are seeing values falling.”
The report showed that of the city’s 10 most expensive suburbs, five — Remuera, Stanley Point, Epsom, Mission Bay and Orakei — dipped in value in the three months to the end of September.
Stanley Point, which was crowned as one of a golden quartet of $2m suburbs at the start of this year when it hit a QV estimated median value of $2.019 million at the end of January, has trended downwards.
After dipping below $2m early in the year, it has continued the slide and in the three months to the end of September fell to $1.96m — a drop of $17,807.92 (0.9 per cent).
Herne Bay managed to hold its title as the country’s priciest suburb with an estimated median value of $2.56m, up $47,819 (1.9 per cent) in the same time period.
Saint Marys Bay also experienced some growth, up $45,746.47 (2.1 per cent) to $2.22m in the last quarter.
However the third $2m+ suburb has been inching down — Remuera dropped $8292 (0.4 per cent) during the quarter to $2.065m.
At the other end of the market five of the least expensive Auckland suburbs, Auckland Central, Wellsford, Manukau, Randwick Park and Manurewa East, have also dipped in price by between 0.7 per cent and 2.9 per cent.
The cheapest of all the suburbs was the apartment-rich area of Auckland Central, which fell $3636 (0.7 per cent) in the three months to the end of September to an estimated median value of $515,800.
Rush said areas with the highest growth last quarter were in the inner city suburbs, a reflection of a trend that “areas further out from the city centre are tending to see values
come back the most”.
However, while growth was strong in some areas, across the board house prices in the Auckland region have dipped in the last quarter by $5219.71 (0.5 per cent) to $1.038m.
CoreLogic head of research Nick Goodall said it was confirmation that the market was cooling.
This followed lending restrictions hitting the investor market and banks being less willing to sign off loan applications to other borrowers.
“Recent reports showed that Auckland has dropped on an annual basis for the first time since 2011.”
Goodall said the report also showed how the market had changed in the three months since the July 1 date which the latest Auckland Council valuations were set at.
“If there’s a little bit of growth, they can assume their CV is lower than the actual value of their house. It is a very good measure to understand how the market has moved.”
Areas further out from the city centre are tending to see values come back the most. Andrea Rush, QV
And with the news last week that the Reserve Bank is undertaking a “modest easing” of the LVR restrictions, Goodall did not expect to see a huge surge in demand or prices.
From the start of next year the Reserve Bank would increase the cap on banks from 10 per cent to 15 per cent for new mortgage lending to owner-occupiers with a deposit of under 20 per cent.
“The feeling is that this is a pretty softly, softly approach that in itself won’t do too much. It may stop demand from dropping but won’t add a whole lot of demand, we are unlikely to see any form of resurgence.”
Rush said the easing of the LVR limits was “very slight” but could allow some people to enter the market that could not have done so before.
“The underlying demand is still there, just many people have found it more difficult to gain finance or to find a deposit to purchase so anything that can ease this a little should result in a few more sales.”