New data shows house prices cracked a new milestone in March as demand continues to significantly outweigh supply.
According to the latest Trade Me Property Price Index released on Wednesday, New Zealand's national average asking price for a property is $805,100 - the first time it has crossed the $800,000 mark. That's up just under 16 percent since March last year, or 14 percent if you take growth in Auckland out of the mix.
It's the seventh month in a row that prices have hit a new record and Trade Me Property sales director Gavin Lloyd says they show "no sign of slowing any time soon".
"While this will be music to the ears of homeowners, no doubt it's hard to hear for prospective buyers who have been hit with relentless price increases for months," Lloyd said.
Demand outstripping supply is a significant factor pushing prices up. Nationwide in March, demand was up 26 percent year-on-year, while supply fell 9 percent.
"As we have seen consistently over the past few months, demand outweighed supply in March, putting pressure on the market and resulting in ongoing price increases."
The Government earlier this year announced a raft of housing measures intended to reduce investor demand and tilt the field towards first-home buyers. Among the announcements was a $3.8 billion Housing Acceleration Fund with an aim "to increase the supply of houses" by helping to fund infrastructure and buy up more land for development.
Auckland continues to be the country's priciest centre, with average asking prices there sitting at $1.047 million, up 10 percent on last year. Demand there was up 21 percent and supply was down 7 percent.
The biggest regional year-on-year leap was in Manawatu/Whanganui, up 23.7 percent on last March to an average price of $520,000.
Every region saw a year-on-year increase, with records being set in all but Nelson/Tasman, West Coast, Otago and Northland.
Wellington saw prices jump 20 percent on last March, the biggest annual increase the region has ever seen. With the average asking price there now being $829,500, Wellington too has broken into the $800,000 bracket for the first time.
"Every district apart from Carterton saw house prices hit a new high in March with Wellington City coming in as the most expensive district in the region, with a record average asking price of $912,400," Lloyd said.
"Supply has been an ongoing problem for the Wellington property market and in March we saw the number of properties listed for sale drop by 9 percent when compared with the same month in 2020.
"Demand, on the other hand, increased in March, with listing views on properties for sale up by 21 percent year-on-year. Until supply begins to match demand, or demand for property cools, prices will continue to rise in Wellington."
Lloyd said it was simple: If houses don't start getting built and put onto the market, Wellington prices will just continue to soar.
Wellington is also where the most popular house in the country was found last month. The Mairangi Rd, Wadestown three-bedroom house had an asking price of $900,000 and was watchlisted 406 times within two days.
Nationally, small, medium and large houses all reached an all-time high in March. The biggest increase was for large houses (5+ bedrooms) with a 17 percent increase. All urban property also hit new records.