The average asking price for homes sold in July indicates sobering news for Auckland homeowners. Meanwhile, competition is expected for buyers in Wellington, Hamilton and the regions.
Based on selling price expectations of Trade Me Property listings, July data shows a 2.2 percent decrease in Auckland's average asking price to $875,450, compared with July last year.
- Latest REINZ figures show busiest July house sales in three years
- Property prices: Regions hit record highs, Auckland lifts again
In contrast, nationwide figures (excluding Auckland), show that the national average asking price rose 7.1 percent compared to the same period last year, pointing to the strong impact that Auckland has had on the prospective Kiwi homeowner's dream.
For townhouses, apartments and units, the nationwide average asking price has risen 1.3 percent, to $562,250.
Auckland asking prices track downwards
While REINZ statistics released in July indicated record numbers in house sales and a flat median house price, July Trade Me Property data hints at the need for Auckland-based sellers to set a realistic asking price.
Trade Me Property's Aaron Clancy said the average asking price in Auckland has fallen almost $71,000 since October 2018.
"This is the fourth consecutive month that property prices have dipped in the Super City, after years of eye-watering price increases the heat has well and truly been taken out of the Auckland property market.
"With interest rates hitting all-time lows and property [asking] prices dipping, it's not surprising that we saw a surge of demand for Auckland properties in July, with listing views up 10 per cent on last year, he said."
Clancy also confirmed that the number of Auckland rental listings are down 2.7 percent compared with June last year.
"There's no growth in both areas [sales and rental].
"Supply is down year-on-year," he said.
The data also confirms that the average asking price in Auckland City is now below the $1 million mark for the first time in almost a year, to $987,250, dipping 4 percent on July 2018.
In North Shore City, the average asking price fell 1.4 percent, to $1,081,300 and in Waitakere City, dipped 0.7 percent, to $799,250.
Following the typical winter slow-down, we can't rule out the possibility of a rebound for Auckland next month.
"We do generally see it flatten off over winter and it's going to be interesting to see what happens... we typically see a lift in volume and activity over the spring period," Clancy confirmed.
Positive news for Auckland families wanting larger homes
The data also indicates that families looking to get into a five-bedroom home in Auckland could be closer to achieving their goal.
"Property prices across every house size in Auckland fell in July, with large houses (5-plus bedrooms) taking the largest hit, falling 6 percent," Clancy said.
Wellington asking prices and listing views up
While Auckland homeowners are coming to terms with the concept of tempering their asking price, for homeowners in the capital, prices are rising to new heights.
July data shows that the average asking price in Wellington increased by 9.4 percent compared with July 2018, to $636,250.
Summing up the renewed vigour in asking prices across the capital, Clancy confirms that there's plenty of activity in the market.
"Since July 2014, average asking prices in the Wellington region have jumped 54 percent.
It's not showing any sign of slowing down either, with the last two years seeing the most rapid increases.
"With the spring selling season around the corner, we expect to see a flurry of activity in the market and we think more record asking prices are likely in the capital," he said.
Clancy said that while every [Wellington] district saw a solid year-on-year increase in asking prices, the big movers were those just outside of the central city.
"Property prices in Porirua and Upper Hutt saw strong double-digit growth in July, with the average asking price jumping 15 and 14.5 percent respectively," he said.
Clancy supports the idea that prices in these regions are following in Auckland's footsteps.
"When Auckland was going ahead in 2016, we then started seeing it flowing out to the Waikato and Bay of Plenty areas with Hamilton and Tauranga, and the same is happening in Wellington.
"It's very common for the metropolitan areas to go ahead. Wellington was slower off the mark than Auckland, and now what we're seeing is Upper Hutt, Lower Hutt, Porirua and even out to the Wairarapa where prices are playing catch-up," he said
Naturally, as people move into the regions due to affordability, prices will rise.
"The issue we're seeing now is that the prices are now becoming unaffordable in the regions," he added.
The data also confirms that the average asking price for the standard three-to-four bedroom home has jumped almost 11 per cent compared to last year, to $673,050.
A sign that Wellington provides solid ground for property developers, asking prices for townhouses also increased.
"Townhouses in Wellington rose a solid 17 percent to a record $629,000 in July, thanks to several new developments in the area," Clancy added.
Hamilton pricing, prospective buyers stay strong
Just 1.5 hours south of Auckland, the data indicates that many Kiwis still consider laying down roots in Hamilton, with the number of listing views up 11 percent on July last year.
Clancy said that as more Kiwis look to buy in the 'halo' regions of Auckland, demand for properties in Hamilton is on the rise.
"Asking prices in Hamilton have risen inline with price growth in the Waikato region, with the average asking price climbing 7 percent to $611,350 in July," Clancy said.
Manawatu, Wanganui, Otago and Southland and Gisborne remain positive
Average asking prices across the regions increased year-on-year, with the exception of Taranaki, which like Auckland, experienced a dip.
"Homeowners in [the] Manawatu, Wanganui, Otago and Southland have plenty of reason to smile after all three regions experienced strong double-digit growth and new records," Clancy reported.
"Gisborne was another strong performer, with property prices jumping 18 percent year-on-year to $360,800," he added.
If you're a buyer, the July data indicates that bar Auckland and Taranaki, in a market of competitive interest rates and strong asking prices, you may have a little competition this spring.
For Auckland's first-home-buyers and people looking to up-grade, this could be your time to negotiate well both on the asking price and interest rate, and get a foot-hold on the property ladder.