Auckland home owners getting greedy
Auckland home owners are asking record prices for their properties. But it appears that is encouraging more people to look for a property outside of the region.
The latest statistics from property website realestate.co.nz show that last month the average asking price in Auckland rose by 1.1 percent to a record of $898,562.
Across the country the average asking price slipped 1.3 percent to $569,971 on the property website.
Asking prices normally correlate closely with the eventual sale prices but are not always an exact match.
Realestate.co.nz says there was a 4.9 percent drop in the number of people searching on the site for Auckland properties, compared to a year ago.
But nationally there was a rise of 14.48 people in people looking, compared to a year ago.
Realestate.co.nz says the numbers suggest the possibility "the shine may have gone off the Auckland market."
The website's commercial manager Vanessa Taylor says "There have been calls across the nation for measures to rein in house prices, but it may be that the market is actually self-correcting, albeit slightly, with buyers unwilling or unable to meet ever-increasing price rises."
"Whether the fall is the start of a trend is still to be determined."
The website says there are significant variations in prices across the country.
The average asking price in Wellington rose three percent from June to $523,946.
In Canterbury the average asking price stood at $462,936, a drop of 0.8 percent from June.
The Northland average asking price stood at $480,006, down 4.7 percent fall from June.
The central North Island rose 10.3 percent to $380,501.
Gisborne was down three percent to $278,325.
Southland recorded a 4.7 percent fall on July, to $250,041.
By contrast, the average asking price in Marlborough hit the half-million- dollar mark for the first time ever ($503,997). The demand for properties in the region rose by 10.94 percent in July and has increased 19.03 per cent in a year.
Asking prices in Central Lakes/Otago fell 20.9 percent last month to $680,672.
Ms Taylor says this could be a one-off, but it is still significantly lower than at the same time last year ($756,063 in July 2015).
The Reserve Bank recently said that 40 percent of all mortgage lending was on interest-only payment terms.
Realestate.co.nz's Vanessa Taylor says "It reinforces what we said in last month's property report where we stated that many investors appear to be looking for capital gain, rather than focused on rental yield."
She says "in Auckland where asking prices continue to rise, investors theoretically would receive 3.28 per cent yield over a 12-month - period based on our calculation of average asking price versus weekly rental price - excluding all external costs."
That contrasts with: West Coast (8.44 per cent yield), Wairarapa (6.01 percent yield) and Southland (5.93 per cent yield).