Lack of homes pushes up Auckland prices

Auckland's residential property values have risen 2.5 per cent from the same time last year. Photo / Herald on Sunday

A shortage of homes for sale has pushed Auckland's residential property values higher than they were a year earlier, QV figures show.

Auckland values for October have climbed 2.5 per cent from the same time last year, while national values for October are 0.2 per cent above last year's, up from the -1.1 per cent recorded the previous month.

Last month the national average sale price for the country was $389,198, up from $387,567 in September, while in Auckland City the average sale price had dropped slightly by 0.2 per cent from $507,617 to $506,642.

QV valuation manager Glenda Whitehead said a shortage of properties, especially in urban areas, had led to more buyers than available properties, meaning many sold for well above expected values.

"While it is clearly a good time to sell, especially in the main centres, needing to buy again in a market which has a shortage of available properties for sale will also be putting some people off."

She said market activity remained below normal spring levels. Sales numbers had remained relatively static in the past few months, and there was little evidence of a rise in new listings in most areas.

"The continued shortage of properties, especially in the main urban areas, is leading to a continued imbalance in the market with more buyers than available properties.

"As a result our valuers are seeing many properties sell for well above their expected values. These demand-based price increases are likely to continue until the balance in the market changes," Ms Whitehead said.

Several factors could account for the lack of strong spring activity.

Many owners would have locked in lower long-term interest rates at the start of the year and would be concerned about losing those rates if they sold, she said.

Needing to buy again in a market with a shortage of available properties would also be putting some people off.

Values in the main centres have recovered since earlier this year and most are now above the same time last year.

Values in the Auckland region are up 2.5 per cent on last year, Wellington is up 1.6 per cent, Christchurch 1.3 per cent and Dunedin 4.3 per cent.

Only Hamilton and Tauranga failed to improve on last year's values, down 0.1 per cent and 1.4 per cent.

Provincial values have risen slowly, and with the exception of New Plymouth, Palmerston North and Nelson, all the centres are down on last year's prices.

Queenstown Lakes prices have suffered the greatest drop, down 9.4 per cent.

October's increase in the Auckland region is an improvement on the 0.6 per cent annual growth reported in September.

For Auckland City, demand in the price range of $600,000 to $900,000 in suburbs close to the CBD remains strong. Listings in this price bracket are low, creating multi-offers and strong results at auction.

In Waitakere, QV reported increased renovations, new builds and infill housing.

Within Manukau, demand from first home buyers and owner-occupiers appears to have returned in the newer suburbs of Dannemora and Flat Bush. Ms Whitehead said investors were active in areas such as Papatoetoe and Manurewa and prices remained relatively stable.

On the North Shore there has been an increased sale of properties over $2 million, particularly in the Milford/Takapuna area.