What’s Happening in the Auckland Market? The trend in the median price was flat to decreasing over the past 18 months with the volume trend flat over the past year. The days to sell trend continues to ease. The House Price Index bounced back this month after four consecutive declines over the prior four months but still has the worst 12 month movement, a 2.0% decline.
O
ur seasonally adjusted results tell us that, compared to what we expect when moving from January to February, the observed increase in median price was more than was expected and the observed large increase in sales count was quite a bit less than expected. The current Days to Sell of 57 days is well above the 10-year average for February which is 42 days. The level of inventory available for sale currently sits at 22 weeks, four weeks more than in February 2018. Bindi Norwell, REINZ CEO, says “Sales were quieter in some areas
across Auckland. Inventory levels in the Auckland region increased 6.7% year-on-year bringing the total inventory to 22 weeks, giving buyers more options and in turn, increased confidence levels. We also see an increase and a rising confidence with first home buyers and activity levels have increased. Investors are still remaining cautious, and there has been an increase of rental properties coming onto the market as the requirements for compliance increase and the uncertainty over CGT continues to be a significant talking point. Vendors are seeing the
Compared to Jan 2018:
Median Sale Price for February 2019
• Median Price down 2.4% • Sales Count down 2.8% • Days to Sell increased 6 days
AUCKLAND REGION
Compared to Dec 2018: • Median Price down 7.3% • Seasonally adjusted median price down 2.4% • Sales Count down 17.4% • Seasonally adjusted sales count up 13.4% • Days to Sell increased 12 days.
Waitakere City
market dynamics and understand that the market is more complex now, but they are still holding out for the right price in many instances. Central Auckland is seeing some good results at auctions and South Auckland has seen an increase of activity in the lower end as people head south of the city to seek more affordable housing. The AML legislation has been around for a while now and it will be interesting to see how days on market will develop going forward.”
$850,000 $775,000 $868,000
Rodney District Papakura District
$649,000 $988,988
North Shore City Manukau City Franklin District Auckland City
$849,000 $670,000 $1,000,000
Disclaimer: Every effort has been made by Mike Pero Real Estate to ensure that the information contained in this publication is complete and accurate. Prospective purchasers and sellers should make their own enquiries to verify any information contained herein. While our information has been prepared with due diligence and care, Mike Pero Real Estate does not accept liability for any errors, mistakes, omissions, or inaccuracies whether expressed or implied.
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Annual Median Price Changes
REINZ Residential Statistics Report forFebruary 2019
FEBRUARY 2018-2019
Number of houses sold across NZ falls by 9.5% in February, says REINZ. “At a time when sales volumes are normally strong, when we look across the country, 13 out of 16 regions actually saw an annual fall in the number of properties sold. The lower levels of sales volumes compared to the same time last year can be attributed to a number of things - the raft of legislative changes impacting the housing market at the moment, the increasing difficulty in accessing finance (despite a record low OCR and very low mortgage rates from the banks) and vendors’ pricing expectations” says REINZ Chief Executive, Bindi Norwell. Median house prices were recorded as follows: Northland
$500,500
Auckland
$850,000
Waikato
$530,000
Bay of Plenty
$588,000
Gisborne
$390,000
Hawke’s Bay
$472,500
Increased
Manawatu/Wanganui
$352,000
Stable
Taranaki
$380,000
Decreased
Wellington
$640,000
Tasman
$580,000
Nelson
$560,000
Marlborough
$438,500
West Coast
$190,000
Record Median Sales
REINZ House Price Index (HPI) - increases 3.2% annually The REINZ House Price Index for New Zealand, which measures the changing value of property in the market, increased 3.2% year-on-year to a new record high of 2,778.
Canterbury
$452,500
The HPI for New Zealand excluding Auckland increased 8.1% from February 2018 to a new record high of 2,728. The Auckland HPI decreased -2.0% year-on-year to 2,838.
Otago
$455,000
The REINZ HPI saw 8 out of 12 regions experience a record high level over the past 12 months, highlighting the overall continued strength of the property market. The exceptions were Northland, Auckland, Otago and Southland.
Southland
$290,000
NZ excluding Auckland
$490,000
NEW ZEALAND
$560,000
In February the Manawatu/Wanganui region again had the highest annual growth rate, a 19.4% increase to a new record high of 2,984, followed by Gisborne/Hawke’s Bay in second place with an annual growth rate of 13.8% to a new record high of 2,762 and in third place was Southland with a 12.6% annual increase to 2,797 – down -1.8% from its peak in January 2019.
The REINZ House Price Index shows: New Zealand
+3.2% on Feb 2018
Days to Sell continues to hover close to 50
NZ ex Auckland
+8.1% on Feb 2018
In February the median number of days to sell a property increased by 3 days from 44 to 47 when compared to February last year.
Auckland
-2.0% on Feb 2018
New Zealand
+1.6% on Jan 2019
NZ ex Auckland
+1.6% on Jan 2019
Auckland
+1.7% on Jan 2019
For New Zealand excluding Auckland, the median days to sell increased by 1 day to 43. However, Auckland saw the median number of days to sell a property increase by 8 days from 49 to 57 – the highest number of days to sell since February 2009. Manawatu/Wanganui had the lowest days to sell of all regions at 30 days, down 10 days from 40 at the same time last year. The West Coast always has the highest days to sell of any region (at 91 days in February 2019), but the median number of days to sell in Northland has reached a high of 61 days – the highest in since August 2015. “With vendors holding out to achieve their price expectations, it’s little surprise that the median number of days to sell has slowly been increasing over the last few months. What was interesting though is that this is the first non-January month since February 2017 that no region had median number of days to sell in the 20s,” says Norwell.
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For more REINZ HPI information, see https://www.reinz.co.nz/reinz-hpi Source: REINZ
Should you buy into Shared Equity Schemes? Shared equity schemes help you get onto the property ladder - but you must know a few things.
A shared equity scheme is soon to be trialled for first home buyers looking to buy new-build houses in Auckland. If successful, the lender offering the scheme intends to expand nationwide, so here is an overview of how they are expected to work.
What is a shared equity scheme? Shared equity schemes allow home buyers to purchase property with a smaller deposit by sharing some of the purchase cost with a shared equity partner. For example, if a buyer has a 10% deposit, a shared equity partner can contribute an additional 10%, while a standard mortgage covers the remaining 80% of the purchase price.
Who will the shared equity partner be? The partner is yet to be named, however shared equity partners could possibly range from private investors, not-for-profits, or even the government.
What’s the catch? Shared equity schemes are not always straightforward, so you should understand the terms of the deal and read the fine print. A few things to consider include: • The shared equity scheme could have a monthly fee which would add to outgoings. • If the property is sold, the shared equity partner would receive a share of any increase in the property value. • An ownership agreement sets out every-
one’s rights which may include the shared equity partner’s ability to sell the property if the buyer experiences financial hardship.
What should you do? Participating in a shared equity scheme needs careful consideration. If you have a low deposit and want to buy property, talk to a Mike Pero Adviser to understand all your options. With the Reserve Bank recently relaxing deposit requirements, first homebuyers have more options than before. Mike Pero Advisers have access to a range of lenders that accept low, gifted and even borrowed deposits. For good advice, reach out to a Mike Pero Adviser today.
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