Andrea Rush: Buyers flee as prices jump 20%

It will be interesting to see what impact the Reserve Bank and Government changes coming in on October 1 have on the market during spring. Photo / NZME.

Opinion

Over the past quarter, fewer properties have been listed for sale in Auckland than over summer. Correspondingly, sales numbers have been lower. However, there were 20 per cent more sales this winter than last year and July saw the highest number of homes sold in Auckland for any July since 2003. Home values across the city have also continued to rise and the latest QV stats show a number of areas across the Super City are up more than 20 per cent year on year.

With the QV House Price Index showing the average home value in the Auckland Region is now more than $850,000, it's no wonder we are seeing a definite trend of Aucklanders purchasing homes outside of the super city. Top of their lists are nearby regional centres such as Hamilton, where the average value is $390,000, Tauranga, where the average value is $490,000, and Whangarei, where the average value is just over $350,000.

For those looking to buy in Auckland, demand has been particularly high for homes in the more affordable range of $400,000 to $1.2 million. To this end, the highest percentage of value growth has occurred in the city's more affordable suburbs.

In Auckland City, south and east demand for homes in Mt Roskill, Glen Innes, Onehunga, Blockhouse Bay and Otahuhu have helped drive values up in these areas by more than 20 per cent year on year.

Waitakere City has seen growth of more than 21 per cent year on year and the most affordable suburbs in the west continue to see homes listed for sale selling quickly and well above what they would have sold for a year ago. Hot suburbs include Glen Eden, Glendene, Kelston, West Harbour, Massey, Ranui, Laingholm and Te Atatu South.

QV stats show the average value in the former North Shore City Council areas is now over $1 million and the more affordable suburbs across the bridge have also been in high demand during winter. Values in the North Shore/Onewa suburbs of Birkdale, Glenfield, Beachhaven, Hillcrest, Northcote, Marlborough, Chatswood and Birkenhead rose by more than 20 per cent year on year but still offer the best value for money on the shore with an average value of just over $820,000. Agents recommend selling homes by auction as it has been too hard to cap price expectations in the heated market in these areas.

In the Manukau/Central area, which includes the suburbs of the Redoubt Rd precinct, Manurewa, Hill Park, The Gardens, Weymouth, Wattle Downs, Otara, East Tamaki and Wiri, values have risen more than 20 per cent year on year. However, the average home value in the Manukau/Central area is now around $555,000 which means these areas still offer some of Auckland's most affordable homes.

Further south, high demand by first-home buyers, speculators and investors has continued to drive value growth in the Papakura and Franklin Districts. Average values in these areas are now over $525,000.

Smaller properties in the more central suburbs have also been in high demand, driving up prices of entry-level homes such as two-bedroom brick-and-tile units. One such property in Meadowbank sold for in excess of $850,000 and another in Point Chevalier sold for more than $900,000.

The apartment market continues to be in high demand as apartments also offer entry-level priced homes in central city or city fringe locations, with some available for under $300,000. However, some top-end apartments now cost more than stand-alone houses and are in high demand from baby boomers downsizing.

Investors and speculators continue to be active in Auckland and are particularly interested in do-ups, home-and-income properties, or sites that offer development potential.

A recent sale of a run-down, two-bedroom cottage on a 774sqm site that can be developed into two units is a good example of what people are willing to pay for land with development potential in Auckland.

It will be interesting to see what impact the Reserve Bank and Government changes coming in on October 1 have on the market during spring.

• Andrea Rush is QV national spokesperson.