Rotorua housing more affordable

By Teuila Fuatai

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Housing in Rotorua is more affordable then many parts of New Zealand, a local real estate expert says.


Real Estate Institute of New Zealand figures show the median house price in Rotorua in December was $210,000. Nationally, it was $398,000.


Rotorua spokesman Ian McDowell said first-time home buyers were well placed in the city.


"Our median's low because we've been selling a lot of properties in the $100,000-$200,000 range."


An international survey released at the end of January found house prices in eight of New Zealand's larger cities were severely unaffordable.


The Annual Demographia International Affordability survey compared median house prices against median household income in different cities last year.


Rotorua was not included in the survey.


Overall, the median New Zealand house price was 5.3 times the median income last year (median multiple).


Aucklanders paid the most - scoring a median multiple of 6.7 on the survey.

Homes in Christchurch (6.6),


Tauranga-Western Bay of Plenty (5.9), Wellington (5.4) and Dunedin (5.1) also rated as severely unaffordable.


Mr McDowell said several city-dwellers had inquired about moving to Rotorua.


"We get a few from Auckland - it's more a lifestyle change. They like it here with the lakes and mountain biking."


Compared with Auckland, Rotorua house prices were cheap, he added.


Median household income for the Bay of Plenty region in the 12 months to June last year was $64,700, according to Stats NZ. Specific figures for Rotorua were unavailable, however the median income for households in the region, excluding the Western Bay and Tauranga city area was $60,400 for the period.


Council of Trade Union secretary Peter Conway said housing affordability was a "major crisis" for many New Zealanders.


"It's a bit of a circular argument back to why are incomes too low and why are housing prices too high."


First-time home buyers were often worst-hit, particularly in the main centres, he said.


"What it creates is insiders and outsiders - it becomes harder and harder for people to enter the housing market and get a good start."


None of New Zealand's eight surveyed metropolitan markets were deemed affordable, with Palmerston North (4.4), Napier-Hastings (4.5) and Hamilton (4.7) all ranked as seriously unaffordable.


Hong Kong, China was the worst place to purchase property last year, with a median multiple of 13.5.

And London, New York and Los Angeles all ranked more affordable than Auckland.


Mr Conway said there was no easy solution to the affordability problem.


"It's not just your level of income, it's your security of income.


"With the huge increase in casual temporary work and fixed-term contracts, it's a lot harder for people to sign up and be able to commit to repayments if they are in a temporary job."


In the survey's introduction, Deputy Prime Minister Bill English said New Zealand's housing affordability problems were "conceptually simple".


"It costs too much and takes too long to build a house," he wrote.


Improving problem areas like land supply, infrastructure provision and regulatory delays would help make homes more affordable, he wrote.


Several commentators weighed in on the Government's housing policies last month.


Christchurch-based co-author Hugh Pavletich said housing affordability should have been addressed immediately after the 2008 election.


Green's co-leader Metiria Turei said too many Kiwi families could no longer afford homes and Labour leader David Shearer blamed "sky-rocketing" house prices on the Government's "hand-off approach" to the housing market.


- Additional reporting Kieran Campbell

 

- ROTORUA DAILY POST

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