QV: Auckland house values up less than 1pc

A sign of softening in figures was illustrated by a slump in the volume of unconditional sales with commissions paid for Barfoot & Thompson. Photo / NZ Herald

Auckland's house value increases slowed to almost snail's pace last month, up less than 1 per cent.

Quotable Value has just released the latest quarterly and monthly data and, as expected, Auckland was up only marginally by 0.2 per cent in December.

December and January are usually the slowest months of the year for the housing sector, due to the holidays and Barfoot & Thompson data out last week also showed a marked decrease in activity.

But over a longer time-frame, Auckland values continued to rise fast.

"Home values in the Auckland region increased 22.5 per cent or $171,406 from $761,858 at December 2014 to $933,264 at December 2015," QV said.

"They rose 4.1 per cent over the past three months but only 0.2 per cent over the final month of the year. They are now 70.8 per cent higher than the previous peak of 2007," QV said in a commentary headed 'Year-end sees Auckland housing market slow while other centres on the rise'.

Auckland region's average current value now stands at $933,264, almost double Wellington's $476,634 and well above New Zealand's average $558,146.

North Shore values now stand at $1,089,745, up 22 per cent annually and 3.6 per cent in the last three months to December compared to the previous three months.

Following the introduction of the new measures in October and November, the rate of growth in the Auckland market slowed, while values in many other centres including Wellington and Dunedin saw significant value increases in the three months of the year.

Auckland City values are now $1,095,838, up 20.7 per cent annually and 3.7 per cent in the last quarter.

Andrea Rush, QV national spokesperson, said massive Auckland value rises during the first nine months of last year were at a rate not seen since the early 1990s.

That led the Government and the Reserve Bank to announce mid-year that they would introduce measures to curb Auckland investors.

"These huge hikes in home values and pending restrictions on investors saw many look to move or invest outside of the Auckland region for more affordable homes or better rental yields during 2015. This resulted in an increase in activity and demand in previously slow housing markets in upper and central North Island centres including Hamilton, Tauranga, the Waikato District, Hawkes Bay, Whangarei and Rotorua.

"Following the introduction of the new measures in October and November, the rate of growth in the Auckland market slowed, while values in many other centres including Wellington and Dunedin saw significant value increases in the three months of the year," she said.

Papakura values increased the most at 29.9 per cent year on year as Aucklanders looked further out to the Super City boundaries to find an affordable entry into the market, QV's commentary said. Manukau City suburbs saw the second largest year-on-year increase, up 26.3 per cent while Waitakere City home values were close behind, rising 25.6 per cent.

Franklin District values rose 20.0 per cent and the Rodney District saw values increase 18.8 per cent.

National property values rose fast.

"Overall the nationwide average shows residential property values increased 14.2 per cent or $69,472 during 2015 from $488,674 in December 2014 to $558,146 in December 2015, according to the latest statistics from Quotable Value (QV) powered by CoreLogic," QV said.

The average national value increased 2.9 per cent over the final three months of 2015 and nationwide values overall are now 34.7 per cent higher than the previous market peak reached in late 2007.

Jonno Ingerson, CoreLogic's director of research, issued an outlook for the housing market this year.

"While Auckland may take a breather, the surrounding areas are likely to continue to rise, driven both by local demand and by Aucklanders choosing to move to more affordable locations. However, the value growth we saw in Hamilton in late 2015 of more than 10 per cent per quarter will not continue, instead settling back to a more moderate rate of value increase. Most of the top half of the North Island will continue to increase likewise.

"It will be a more variable outlook further south where the effect of Auckland is far less.

Wellington values have been accelerating from the past few months and that will continue in a market where current demand is outstripping supply. Dunedin will also continue to increase, while Christchurch is more likely to stay flat," Ingerson said.

The easing of the LVR restrictions outside Auckland will be a key contributor to strength in these markets as it will allow more first home buyers and potentially upgraders to purchase, he said.