Housing shortage rolls on

Migration will keep the Auckland housing market bubbling along nicely this year according to Harcourts’ CEO Chris Kennedy. Last year more than 70,000 new arrivals settled in New Zealand with 60 per cent choosing to live in the Super City — that’s 42,000 people looking for around 14,000 homes at a time when the city was already short of 20,000 homes.

The inward migration trend is likely to continue unless government tightens the system up, and there’s no outward sign of that happening.

Kennedy says there has been a fall in the number of property investors buying real estate since they needed a 40 per cent deposit, as a result of loan to value ratio rules introduced in November.

“With investment dropping away a little, the market may not remain at the same speed that we have seen in 2015- 16,” he says.

Kennedy says it’s important to remember that a market cooling isn’t the same as saying a bubble is bursting. It’s just merely returning to the more balanced activity levels of prior to 2014 that still allows room for growth, he says.

Prices steady

Sale prices of real estate in Auckland are “rock steady” according to figures from realtor Barfoot & Thompson.

Its median sale price for January is $ 846,500, up $ 6000 on December, but down from the $ 852,000 achieved during the last quarter.

Though January is normally associated with a dip in prices, the firm’s Peter Thompson says that for the first time in 14 years the average and median prices were marginally higher than those in December.

“They remained rock steady with the prices being achieved at the end of last year,” he says.

However, he says though sales numbers fell more than is usual, it had 3620 properties on its books at the end of January.

He says: “Caution should be used in trying to read too much into sales data for January. The market is still regaining momentum from the holiday break and it can lead to statistical anomalies.”

He says a contributing factor to last month’s higher prices was that 31.2 per cent of all the homes sold in January went for more than $ 1 million.

This is a higher percentage than normally seen in January sales.

Hot to trot

Alexandra Park has sold all 246 apartments in stage one and two of its residential development at the Auckland Trotting Club in Epsom. Sales of the freehold properties at 223 Green Lane West grossed $ 300 million. One penthouse sold for $ 4.75 million.

The first of the 750 residents will move in alongside the live trotting track next year.

A third stage of the development in currently under discussion.