The national median price for residential property hit $300,000 for the first time in November and the median price is now 53% up on the same month in 2002.
The new benchmark is likely to heighten the likelihood of the Reserve Bank taking even stronger measures to dampen spending.
Describing the market as producing a “stayer’s run”, REINZ national president Howard Morley says that the latest increase in the national medium show a steadying but very healthy property market.
“The fact is that demand for housing is strong both in the major centres and in the provinces and prices are simply a reflection of that. We believe rising construction costs rather than speculative expectations are one of the key drivers of rising property prices. People make the comparison between building a new home and buying an existing one and they see the value in existing property.
“High employment levels are also giving home owners some comfort to upgrade or add on to their existing home,” he says.
Morley said that the Reserve Bank would no doubt respond with further increases in the OCR
“But given the fact that only a third of homeowners have a mortgage and around 80% of mortgages are on fixed rates, lifting the OCR is having more impact on farmers, business owners and business confidence than the housing market.”
The median was up from $295,000 in October, on strong sales which rose from 8513 in October to 9357 in November, compared with the November 2004 sales of 9474. Days to sell fell from 28 in October to 27 and the national median price of $300,000 is a 15.38% increase over the November 2004 figure of $260,000.
Around the regions there were seven rises and four falls with Auckland and Wellington standing out with good gains.
Northland was easier at $253,500 down from $256,150 in October, while Auckland had a surge from $380,000 in October to $390,000.
Waikato/Bay of Plenty/Gisborne were up slightly from $274,000 in October to $275,000 while Hawke’s Bay was up sharply from $250,000 to $265,000, after two static months at $250,000, Manawatu/Wanganui was up from $183,550 to $187,000, but Taranaki continued to see its median slip from $211,000 to $205,000.
Wellington saw strong growth in its median up from $304,500 in October to $315,250 in November. Nelson/Marlborough was heading back towards the September median of $262,250 falling from $273,800 to $265,500 and Canterbury/Westland rose from $260,000 to $270,000. Central Otago Lakes continued its downward trend from $417,000 to $400,000, due to a substantial decrease in sales from 158 to 98.
Otago remained steady at $215,000, while Southland saw a strong rise to $129,000 from $119,250.
On a year-to-year basis Manawatu/Wanganui is the fast growing region with a 25.50% increase, although this is slightly down from the October increase of 26.58%, Taranaki remains at number two on 23.12%, followed by Canterbury/Westland at 20%.
In the major centres, metropolitan Auckland median rose from $380,000 to $392,000 on sales up from 2547 to 2764 while Auckland City was up sharply from $425,000 to $460,000 on sales up from 850 to 992. Wellington Central continued to rise from $385,000 to $391,570. The Christchurch metropolitan median was up from $280,000 to $295,000, while Dunedin metropolitan fell again from $235,000 to $230,500.
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