CoreLogic director of research Jonno Ingerson
by Miriam Bell
CoreLogic director of research Jonno Ingerson
“I’m going to call this....Auckland has already turned,” Core Logic director of research Jonno Ingerson said at the NZ Property Investor Federation conference on the weekend.
One of the measures he looks at is bank valuation activity against sales activity as they “almost perfectly match.”
He says bank valuations have decreased in Auckland – to the point that it is slower than elsewhere in the country.
Ingerson said that while Auckland has turned surrounding regions, particularly Whangarei, Hamilton and Tauranga had already taken off and some buyers may have missed the boat already.
Another factor is that the number of property listings has slowed when they should be picking up on a seasonal basis.
“Listings should be screaming up at this time of the year as we come into Christmas,” he said. “The number of new listings is starting to back off and that’s anti-seasonal.”
“That’s very unusual.”
Ingerson also told delegates to be very careful using median sale price as a measure of what is going on. He prefers a stratified median price index which gives a better picture of what is happening in the market.
As for reasons behind the fall, Ingerson, suggested there were a variety of reasons for the turnaround.
“The Auckland market is slowing, probably driven by China’s slowdown along with the Government’s tax changes and the looming LVR changes,” he said
However, the city’s supply shortage means there is no quick fix to the price pressures in the market.
For these reasons, Aucklanders will continue to move out into other areas like Hamilton and Tauranga – as current evidence shows they are doing in growing numbers.
Ingerson said sales activity in the regions will continue to strengthen but it is important to remember that different factors affect different markets.
While Auckland’s values are not likely to show strong increases for some time, that does not mean that values in other markets will catch those of Auckland, he said.
“The gap between Auckland and the rest of the main centres does not always close. Again, there are different factors, such as the local economy, at play in all these markets.
“So, while values are definitely picking up in other centres, like Hamilton and Tauranga, I wouldn’t expect that prices in other centres will ever catch those in Auckland.”
Ingerson added it is important not to overlook the fact there is still a colossal amount of Chinese money set to flow into the New Zealand market.
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