Anne Gibson

Property editor of the NZ Herald

Auckland house values soar

The average house value in Auckland is now $529,508 - 2.2 per cent above the 2007 peak. Photo / Chris Skelton
The average house value in Auckland is now $529,508 - 2.2 per cent above the 2007 peak. Photo / Chris Skelton

Auckland house values have soared past the 2007 peak, as confident first-home buyers enter the market and property owners finally make a move.

While Auckland leads the way - house prices are up 5 per cent in a year - cities such as Wellington, Hamilton, Tauranga, Whangarei, Christchurch and Dunedin have also recorded rises of between 0.6 and 4.1 per cent, according to latest QV statistics.

The average house value in Auckland is now $529,508 - 2.2 per cent above the 2007 peak. Christchurch values ($388,629) have also passed 2007, while nationally, prices are just 3 per cent below the peak.

"Sales activity remained strong in March, returning to the highest levels since 2009," said QV research director Jonno Ingerson.

"Activity levels have been bolstered by first-home buyers having enough confidence to enter the market, while some existing homeowners are now ready to make a move they may have been delaying for several years."

He said sales activity was still being constrained by a lack of supply in some areas, particularly Auckland, Christchurch and parts of Wellington.

The old Auckland City area remains the fastest-growing part of the region, up 6.9 per cent in a year and now 4.8 per cent above the 2007 peak, said QV valuer Glenda Whitehead.

The southern part of the old city - Mt Eden to Waterview and Blockhouse Bay to Penrose - has risen 8.8 per cent over the past year and is now 6.1 per cent above the previous peak.

Last night, the buoyant inner-city Auckland housing market continued its run of high prices when a renovated bungalow at 94 Norfolk St, Ponsonby, sold for $1.85 million, more than double its pre-renovation valuation of $840,000, and a villa at 51 Murdoch Rd, Grey Lynn, sold for $1.27 million, nearly $500,000 above its capital valuation of $830,000.

Both homes attracted strong interest at a Ray White auction in Ponsonby.

"Quality properties in good school zones and near the city centre remain in high demand," said Ms Whitehead. "However, there are insufficient properties coming onto the market to meet this demand, which is tending to put upward pressure on prices.

"In central areas, where zoning will allow, we are starting to see infill housing sites being created, with seemingly good demand for these vacant sections either from spec builders or potential owner/occupiers," she said.

Barfoot & Thompson managing director Peter Thompson said March was his firm's busiest month in five years - the company sold 1246 houses, up 63 per cent on February and 16.4 per cent on last March.

Their average sales price for the month was $571,076, up 6.5 per cent on February but down 1.7 per cent on March last year.

"March [this year] was a month where the views of buyers and sellers reached common agreement as to where values were at, and we experienced the highest level of sales since March 2007," Mr Thompson said.

Economists are not expecting interest rates to rise until either later this year or early next year, despite the heat in Auckland's market.

Auckland real estate agencies are complaining about the lack of new listings, saying they cannot keep pace with demand.

"Our number of listings at the end of March are down 17.8 per cent on those for last March, and is the lowest we have had at this time of the year for four years," Mr Thompson said.

"Buyer interest remains strong."

The Real Estate Institute said February data showed strong sales growth in the housing market - with 6168 unconditional sales for the month, up 37 per cent or 1666 sales compared with the same time last year.

That was the best February result the market had recorded since 2008.

The national median house price remained steady for the third straight month at $355,000, up $5000 or 1.4 per cent on February last year, the institute said.

It is due to release its March results shortly.

The latest figures come after a state house in Pt Chevalier sold for $850,000 at auction and a rental crisis which has forced a number of renters into the buyers' market - adding to the demand.

According to the latest Roost Rent or Buy report, it takes the typical Kiwi first-buyer household just slightly more money to service a mortgage on a bottom-range house than it costs to pay a median rent.

And the high demand for homes has made auctions more attractive for sellers as it gives them the upper hand.

- NZ Herald

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