First-home buyers eye rent rises
Housing market activity is picking up around the country as buyers return from holiday, QV says.
"It's very much a continuation of last year's theme in the Christchurch market. A high supply of housing stock and a lack of demand are driving low-value growth."
QV senior consultant Daryl Taggart
This year looks set to be a year of moderate house price growth with more first-home buyers entering the market, Quotable Value (QV) says.
Its latest report shows nationwide property values were 6.4 per cent up in January compared with the year before. They rose 3.8 per cent over the quarter.
Auckland prices were flat, 0.7 per cent up year-on-year. Christchurch was also stable but values rose in Wellington and Dunedin.
Hastings and Napier had the fastest annual value growth of the country, at more than 15 per cent, followed by Whangarei at 10 per cent.
‘‘January has seen values continue to rise in many places around New Zealand but values have dropped in others and in general activity has been slower in many places over the holiday season,’’ QV general manager David Nagel said.
‘‘Values in Auckland are now rising, with quarterly growth up 1.6 per cent, which is a greater increase compared to the last quarter of 2017.
‘‘Market activity across the nation appears to be picking up now that people have returned to work.’’
He said the loosening of loan-tovalue ratio (LVR) restrictions for investors and home buyers, low interest rates and a shortage of housing supply would mean it was likely moderate value growth would continue through February and March.
Values across the wider Wellington region rose 9 per cent or $52,489 over the past year, and 4 per cent over the quarter, to an average value of $634,811 in January.
QV Wellington senior consultant David Cornford said: ‘‘We have seen a typical slowdown in activity over the holiday period, although activity has picked up with fresh listings and wellattended open homes since Wellington Anniversary weekend.
‘‘A lack of housing supply, coupled with a recent increase in population, continues to put upwards pressure on values. This tight supply is creating strong demand for vacant land and new builds – particularly in the outer Wellington regions … We’re also seeing strong competition in the $1 [million] to $1.5 million range for family homes.’’
Christchurch values dropped slightly, down 0.6 per cent or $3080 over the past year.
QV Christchurch senior consultant Daryl Taggart said: ‘‘It’s very much a continuation of last year’s theme in the Christchurch market. A high supply of housing stock and a lack of demand are driving low-value growth.
‘‘In saying this, we are seeing that those properties which have managed to generate a good deal of prospective buyer interest have sold very well.
‘‘There are also some positive developments and projects being completed in the city, which is encouraging.’’
Dunedin values rose 9.3 per cent over the past year to an average value of $392,512 in January 2018. Values also increased 2.6 per cent over the past three months.
QV Dunedin consultant Aidan Young said: ‘‘The market has continued its positive growth, with impressive turnouts at open homes and relatively high sales prices.
‘‘The first-home buyer market remains buoyant, due to a comparatively low entry-level price point.
‘‘We’re also seeing plenty of sales activity at the upper end – around the $1m mark – which again reflects a good level of confidence in higher priced homes. There is currently significant demand for vacant land, so we’re continuing to see competitive prices for sections across the city.
‘‘These prevailing market conditions are also causing rental prices to increase, which may be attributed to potential buyers being required to stay in rental properties longer until they can find [and/or] afford to enter the market.’’