A “chronic lack” of housing supply is driving up prices across New Zealand, with record median prices reached in four of the 10 regions and sales volumes rising across the board in April, according to the Real Estate Institute.
Record median prices were reached in Waikato/Bay of Plenty ($417,000), Taranaki ($342,500), Canterbury/Westland ($427,250) and Otago ($284,000) last month.
REINZ says that shows that the “halo effect” of rising Auckland house prices is strengthening in regions where it’s already present and moving onto new regions, driven by what chief executive Colleen Milne called “a chronic lack of supply”.
“Anecdotal evidence suggests that investors outside of Auckland are increasingly looking to real estate investments to improve their yields compared to bank deposits,” Milne said.
“First home buyers are also taking advantage of low mortgage rates, putting pressure on the number of properties available for sale. The strength of the seasonally adjusted level of sales demonstrates that the underlying demand for real estate across New Zealand remains strong, with every region recording an increase on a seasonally adjusted basis.”
The national median price rose 7.7 per cent to $490,000 in April.
Excluding Auckland, the national median price gained 8.2 per cent to $382,000. The number of dwellings sold in April fell 10.1 per cent from March, REINZ said. Over the past 10 years, the average fall from March to April has been 16.6 per cent.
This morning, the Reserve Bank said it’s considering whether to impose further home-loan restrictions amid signs that price pressures are re-emerging, especially in Auckland where prices “remain stretched”.
Milne said Auckland had seen a rebound in sales over the past two months, with adjustment to new LVR rules “over.” The median house price in metropolitan Auckland is now $840,000, compared to $745,000 a year earlier, and it took an average of 32 days to sell a house in April, compared to 34 a year earlier.