Don't panic over falling Auckland house prices - housing expert

A housing strategist is throwing out any concern about a drop in Auckland's market.

The city housing market is being compared to Sydney and Melbourne which have seen major price falls, the largest since the global financial crisis.

In the June quarter, Melbourne's house prices dropped almost 2 percent, according to the Domain report. This year to June, Sydney house prices have fallen 4.5 percent, the report says.

But housing strategist Leonie Freeman says a slight downturn wouldn't be major.

"One of the things in the Auckland housing market is that we have high levels of demand and we still have insufficient supply."

She says there is likely to be little movement.

"Many homeowners basically just batten down the hatches and they remain in their house."

Ms Freeman says the market has always gone through cycles, and expects small levels of growth to continue.

In June, Deputy Prime Minister Winston Peters said he wants to get house prices to no more than five times the living wage - so around $213,000. At the time, the median price of a house nationwide was $550,000, and in Auckland it's $870,000.

Not a single region of New Zealand is considered affordable under the Demographia International Housing Affordability Survey. It says anything above three times the median income is unaffordable. Whanganui comes closest at 3.03. Auckland is at 9.3 and Queenstown 11.26.


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