Quotable Value Ltd said today Auckland home values rose by an average 22.5% ($171,406) in 2015, from $761,858 to $933,264.
Nationally, the rise was 14.2% ($69,472) from $488,674 to $558,146.
Auckland values rose 4.1% over the last quarter, but only 0.2% in December. The rise since the previous peak in 2007 was 70.8%.
The national value gain for the quarter was 2.9%, and 34.7% since 2007.
Sales volumes were up on 2014 for much of the year, with the exception of January, reversing the trend of historically low levels seen since the global financial crisis. Top month for sales was March, at over 10,000.
QV national spokesperson Andrea Rush said today: “Massive increases in Auckland home values during the first 9 months of 2015, at a rate not seen since the early 1990s, led the Government & 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.”
CoreLogic NZ Ltd, in which Government-owned Quotable Value has a 40% stake and RP Data NZ Ltd holds 60%, produced buyer classification analysis and more detail on Aucklanders’ influence outside their home territory.
It said the most active group of buyers, particularly in Auckland, owned multiple properties – mostly investors. Their share of sales increased from 35% in 2013 to a peak of 40% in the second half of 2015.
First-homebuyers returned to the market. CoreLogic research director Jonno Ingerson said the loan:value ratio speed limits the Reserve Bank put in place in October 2013, to limit banks’ lending to customers with low deposits, had the effect of decreasing the first-homebuyer share of sales in Auckland from 23% in mid-2013 to 19% by mid-2014.
“Now first-homebuyers are finding ways back into the market, either by saving for a larger deposit or lowering their price expectations. As a result the share of first-homebuyer sales is now back to 23% and climbing. The story is similar outside Auckland.
“Another clear trend in the types of buyers active in various markets was the spread of Auckland people & money to the surrounding areas. From the buyer classification analysis we can see people’s movement patterns. During 2015 there was an increase in Aucklanders moving to Hamilton, Tauranga & the Waikato district.”
In Hamilton, 22% of the sales to movers in 2015 were to those who’d just moved from Auckland, up from 13% in 2014.
In Tauranga, this movement of Aucklanders had been increasing steadily since 2012, when they accounted for just 12% of movers. By the end of last year Aucklanders made up 30% of this category.
“The Waikato district, which stretches from the southern boundary of Auckland south to Hamilton City, has been a popular part of the country for Aucklanders to move to. With improved state highways it is possible for these people to still work in Auckland but to live somewhere much cheaper. Since 2009, the percentage of movers to the Waikato district being from Auckland has climbed from 20% to 46% in 2015.”
Mr Ingerson said Aucklanders weren’t just cashing up & moving out, more of them were also investing elsewhere, chasing better rental yields & more affordable properties.
“In 2014, 6% of all purchases in Hamilton were by investors who already had properties elsewhere in the country and were buying a Hamilton investment property for the first time. The vast majority of these were Auckland investors starting up in the Hamilton market. In 2015 this increased to 14% of all sales in Hamilton.
“Likewise in Tauranga, where 10% of 2014 sales were to investors buying in Tauranga for the first time, this increased to 13% at the end of 2015.
“There has been anecdotal evidence of Auckland investors being increasingly active in Wellington, but there is little evidence in the data to support that currently.”
Forecast for Auckland
Mr Ingerson said the outlook for Auckland residential was a short-term drop in values, but for upward pressure to kick in: “With the various Government & Reserve Bank restrictions now beginning to take effect, and foreign buyers apparently much less active, our expectations are that Auckland values will drop a few percent over the next few months.
“However, mortgage interest rates are at historic lows, migration at historic highs, and there is a substantial shortage of housing in Auckland. These are strong factors putting upward pressure on Auckland prices and, as a result, any drop in values is likely to be shallow & short-lived.
“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%/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 for 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.”
Around Auckland on the old council boundaries, plus Kaipara and the national, Wellington & Christchurch figures, showing the average current value, changes over 3 months & 12 months, and the change since the 2007 market peak:
Kaipara, $365,763, 2.2%, 7.7%, -7.8%
Rodney, $815,353, 6.6%, 18.8%, 39.0%
North, $828,212, 6.8%, 19.6%, 37.9%
Hibiscus Coast, $804,163, 6.5%, 18.0%, 36.9%
North Shore, $1,089,745, 3.6%, 22.0%, 68.9%
Coastal, $1,244,765, 3.2%, 22.4%, 65.2%
Onewa, $878,235, 2.5%, 20.8%, 77.1%
North Harbour, $1,053,882, 5.6%, 22.5%, 73.4%
Waitakere, $748,011, 3.8%, 25.6%, 76.4%
Auckland City, $1,095,838, 3.7%, 20.7%, 76.0%
Central, $950,815, 4.0%, 20.4%, 67.0%
East, $1,373,235, 4.8%, 20.7%, 72.3%
South, $991,153, 2.2%, 21.0%, 84.1%
Islands, $906,239, 2.6%, 18.0%, 41.8%
Manukau, $796,027, 4.4%, 26.3%, 73.9%
East, $1,021,890, 4.5%, 23.8%, 71.5%
Central, $619,257, 3.9%, 29.3%, 64.7%
North-west, $677,480, 4.8%, 28.0%, 83.4%
Papakura, $601,717, 5.7%, 29.9%, 67.3%
Franklin, $580,110, 4.7%, 20.0%, 46.7%
Auckland region, $933,264, 4.1%, 22.5%, 70.8%
Wellington region, $476,634, 4.5%, 5.1%, 4.6%
Christchurch, $482,043, 1.5%, 2.6%, 27.1%
Total NZ, $558,146, 2.9%, 14.2% , 34.7%
Attribution: QV release.