House prices drop in nearly every suburb across the country
House prices in more than 90% of Auckland’s suburbs have dropped.
Monday, January 9th 2023, 10:06AM
by Sally Lindsay
Over the three months to the end of December, 90% of Auckland suburbs – 180 of 201 – have had a median property value drop – 73 of those suburbs have fallen at least -2%. At the other end of the spectrum, only eight had a rise of 1% or more, CoreLogic’s interactive Mapping the Market tool shows.
Bucking the trend is Herne Bay, which remains Auckland’s most expensive suburb, with a median value of $3.6 million. It has had a slight pickup in value of 0.5% since September. By contrast, areas such as Sunnyhills and Omaha have seen their median value drop by $70,000 or more over the past three months.
Across the rest of the country prices have continued to slide, with the Mapping the Market tool, updated quarterly, providing insight into how the value of property varies across cities, across the country, as well as how values have shifted over time.
In the latest update, 776 of the 948 suburbs analysed recorded a fall in median values between September and December. The suburb of Kawakawa in the country’s Far North District had the highest percentage growth rate – up 6.5% - to a median of $469,550.
The lifestyle suburbs of Arrowtown and Lower Shotover, both in the South Island’s Queenstown-Lakes District, had the highest dollar increase for the quarter, increasing 4.9% and 4.8%, equivalent to $102,750 and $74,500 on average respectively.
CoreLogic NZ’s Chief Property Economist Kelvin Davidson says only 66 suburbs, about 7%, recorded a growth rate of 1% or more in the past three months, a low proportion which reiterated the acceleration of the housing downswing in 2022.
Of those, many were located in the country’s rural and more affordable southern districts, including 38 of those 66 suburbs, which have a median value of $700,000 or less.
“These figures are the culmination of the lagged impact of rate rises, record inflation and other economic influences having an impact on the market,” Davidson says.
“We knew it was coming and it’s been interesting to see it play out, with downward momentum widespread, but almost universal in our city centres with few areas able to escape the weakness.”
Across the country, 56 suburbs recorded a fall in median value of 5% or more, with the two largest declines hitting Korokoro in Lower Hutt City and Mangakino in the Taupo District, which fell -10.2% and -10.7% respectively.
Quarterly value changes by main centre suburbs.
Hamilton
Over the past three months, all 34 suburbs in Hamilton have seen a fall in their median property value, ranging from -3.4% in Melville to -0.5% in Baverstock. In 13 of the 34 suburbs, the drop has been at least 2%.
Tauranga
Some parts of Tauranga have avoided median value falls in the past three months (Matua, Judea, and Bellevue), but the rest declined – ranging from -0.1% in Ohauiti to -2.7% in Tauranga South.
Wellington
There have been near universal falls in median property values across the wider Wellington area lately, with only Aotea, Waitangirua, and Cannons Creek (all in Porirua) having avoided declines since September. The remaining 91 suburbs all fell, and by at least 1.5%. The weakest was Korokoro, at -10.2%. Seatoun remains the most expensive suburb, despite values dropping 4.0% in the past three months.
Christchurch
Roughly a quarter of Christchurch’s suburbs (21 out of 85 analysed) avoided recording a fall in values last quarter. The -3.2% falls in Hillmorton and Russley may have been the worst in the city, but were relatively mild compared to other parts of NZ.
Dunedin
Sixteen of 62 suburbs in Dunedin have avoided median value falls since September, while the worst declines (e.g. -3.1% in Waikouaiti) were mild compared to other parts of of the country. Even so, the momentum for the Dunedin market generally still seems to be downwards.
Market outlook
Davidson says the economy and property market have clear challenges ahead this year, and the country’s labour market and mortgage rates may be the key drivers again, as they were last year.
“The general outlook for the housing market remains weak, especially in light of the Reserve Bank’s predictions that the economy will enter a recession.
“Inflation is not expected to begin easing until the second half of this year and the official cash rate and unemployment levels will both increase. It’s a tricky combination for the property market and property investors and home owners alike.
“However, if large-scale job losses can be avoided, further falls in property values may be contained and possibly plateau in the second half of the year. But pessimism would take over if employment did start to fall more sharply.”
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