Bay of Plenty new growth star

More evidence that the “Auckland effect” is fuelling supercharged growth in some regional markets arrived today in new Trade Me Property data.

Friday, June 10th 2016, 11:30AM

by Miriam Bell

Tauranga

The latest Trade Me Property Price Index provided a mixed bag of average asking price results for May 2016.

Both the national average asking price and Auckland’s average asking price dropped slightly as compared to April 2016 – albeit by a tiny 0.1% in each case.

That left the national average asking price at $584,400 (which is up 9.2% on May 2015) and Auckland’s average asking price at $842,550 (which is up 12.7% on May 2015).

Property markets around New Zealand also returned a diverse set of average asking price results with five regions recording year-on- year falls, while another six experienced double-digit growth.

Head of Trade Me Property Nigel Jeffries said that certain regional markets are seeing extremely strong growth, potentially driven by Auckland investors seeking opportunities.

Prime among these are Hawkes Bay and the Bay of Plenty, which both saw year-on-year increases of over 23% in average asking price.

“Lower average property prices makes it easier to get a foot on the property ladder, but in turn this activity heats the market up and leads to increases in average asking prices,” Jeffries said.

However, in his view, it is the Bay of Plenty market which is currently star player.

The average Bay of Plenty asking price Bay of Plenty property hit $533,600 in May.

This was an increase of $101,250 over the past 12 months, which surpasses the $95,100 lift in Auckland’s average asking price over the same period.

Jeffries said the Bay of Plenty has seen “rocket-fuelled growth” for the past year as a flow-on effect of Auckland’s super-charged property market.

Not only has it seen a 23.4% year-on-year increase in average asking price, it has also seen a 46% increase over the past five years.

"The Bay of Plenty is fast becoming the new kid on block, challenging Auckland in terms of growth.”

Of the regions that are not doing so well, Canterbury, Southland, West Coast, Gisborne and Taranaki all saw a dip in average asking prices.

Jefferies added that Trade Me Property’s data also shows smaller (1-2 bedroom) houses and units are in high demand.

“These smaller and cheaper properties appeal to investors as lower-entry deposit options, and we’re seeing a big lift in average asking prices as a result.”

 

« Auckland prices static Regions outpacing Auckland - REINZ »

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