The median price of sales recorded in Auckland by the Real Estate Institute rose by $102,500 (+14%) to a record high of $842,500 in August.
Last week, Quotable Value Ltd put the average value of Auckland housing at $1 million. The QV index, “powered” by input from the international CoreLogic group, is based on sales on a moving 3-month period (more on that below).
The Real Estate Institute said on Wednesday prices rose by 21% in Manukau in August, 20% in outer Auckland and 14% in Rodney (which includes the Hibiscus Coast) and on the isthmus. Compared to July the median price rose by $17,500 (2%) – 9% in Auckland City, 3% in outer Auckland and 1% in Rodney & Manukau.
Institute spokesman Bryan Thomson said inventory levels were low but slowly increasing – in Auckland, up from 10 weeks’ supply in July to 12 weeks’ supply in August. He said sales volumes fell 20% in Auckland compared to a year ago, and 3% nationally.
“The indications are that the struggle for stock is the biggest factor driving market behaviour & price expectations across the country, as we await spring listings. The continued shortage of listings, coupled with the impact of the loan:valuation ratio (LVR) changes on investors, is seeing sales volumes more muted than expected at this time of year.”
The institute recorded 7527 unconditional sales in August, up 3% on July but down 3% from a year ago.
Section sales, which are exempt from the new LVR ratios, jumped 37% nationally compared to last August. Auckland section sales were up 19%.
CoreLogic NZ Ltd’s head of research, Jonno Ingerson, said when the $1 million tag arrived last week: “This latest milestone has led to the housing minister being labelled the ‘million dollar minister’, the front page of the papers & the news websites have been awash with breathless stories of Auckland’s unaffordability, and the talkback lines filled with the usual pundits.
“Why don’t I care? Because it’s just a number. It’s just one way of measuring Auckland’s house prices. I could give you 5 others, some of which show Auckland has been beyond a million dollars for a long time, and others which show it is yet to get there.
“But they all share the same common theme. Auckland’s house prices have been rising for years and very little has been done that has slowed them. Affordability is now a very real issue for many people…. That story might be about to change, at least for a while. I’m watching some hard data coming across my desk that suggests the heat has well & truly come out of the market.”
Mr Ingerson said the monthly QV house price index was an extremely reliable measure of value change in the housing stock of an area, but it turned slowly by being based on data from the last 3 months. However, he added that “anything more reactive than the QV house price index tends to be more volatile, so you’re never sure if an up or a down is real or noise”.
Back to the Real Estate Institute figures:
Sales nationally in price brackets and their share of the market in August 2016 (August 2015 in brackets):
$1 million-plus, 987 (848), 13.1% (10.9%)
$600-999,999, 1915 (1834), 25.4% (23.6%)
$400-599,999, 1819 (1995), 24.2% (24.9%)
Under $400,000, 2806 (3150), 37.3% (40.6%)
2 years ago, in August 2014, 46% of sales were in the under-$400,000 bracket. During the next year that bottom bracket’s share of the market slid, but in the last year it’s moved in a range of about 4%.
Around the Auckland region on the old boundaries, August 2016 median & sales with July 2016 & August 2015 in brackets:
North Shore, $1,045,000 ($1,062,500, $935,500), 410 (408, 556)
Waitakere, $800,000 ($803,000, $741,000), 345 (350, 404)
Auckland City, $911,750 ($837,000, $800,000), 726 (817, 906)
Manukau, $815,000 ($805,000, $675,000), 462 (473, 595)
Rodney, $862,500 ($852,500, $755,650), 192 (178, 184)
Auckland region, $842,500 ($825,000, $740,000), 2413 (2520, 3002)
7 September 2016: Multiple owners still highly active as QV Auckland housing index tops $1 million
Attribution: Real Estate Institute, CoreLogic.