About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   tmmonline.nz  |   landlords.co.nz
Last Article Uploaded: Sunday, November 17th, 2:29PM
rss
Latest Headlines

Echoes of past cycle - ANZ

Auckland’s market is underperforming compared to hot regional markets and ANZ economists say this situation will persist if this property cycle plays out like the last cycle did.

Friday, June 30th 2017, 11:45AM

by Miriam Bell

ANZ chief economist Cameron Bagrie

ANZ has just released its latest Property Focus report and it states that the clear take-away, from recent data, is that Auckland is bearing the brunt of the recent slowdown in housing market activity

The bank’s chief economist, Cameron Bagrie, said recent LVR restrictions have had a direct impact on investor lending and Auckland’s House Price Index (HPI) is now moving backwards, with prices lower than they were six months ago.

“When compared with the rest of New Zealand, it looks like 2004-2006 all over again, with Auckland underperforming the rest of the country.”

However, there is still daylight between the median sales price in Auckland and the rest of New Zealand, he said.

“That’s a huge incentive to buy somewhere outside of Auckland if you’re an investor, and to cash up and move if you’re retiring.”

In ANZ’s view, Auckland’s underperformance is a story that will persist if the 2005-2007 experience is repeated.

“Capital (and people) naturally flow to regions where valuations look more attractive and the gap between Auckland house prices and the rest of the country is extreme.”

While Auckland’s market may be going through cooler times, many other regional markets are still performing well and playing catch-up.

Star performers continue to be the Waikato, which benefits from its proximity to Auckland, and the Bay of Plenty, which has seen migration to the region boom in recent years, according to ANZ.

Otago is another star performer with its HPI increasing by 48% over the past three years, which outperforms both Auckland (47%) and regions other than Auckland (34%).

But Bagrie said that Queenstown will be driving a fair bit of that, with the traditionally boom-bust town benefiting from both soaring tourism and very strong population growth.

The other regional markets that are performing very strongly are Northland, Hawkes Bay, Manawatu-Wanganui, and “turbo-charged” Wellington.

Conversely, Canterbury is an underperformer – although this is largely due to strong growth in housing supply in recent years.

Bagrie said the property market is softening due to a turn in the interest rate cycle, less credit, the LVRs and severely stretched affordability.

“But there is still incremental support for prices to lift after a lull courtesy of population growth and a fundamental mismatch between supply and demand.

“We think the former factors will be the key influences over the coming year and expect house price momentum to remain subdued.”

Read more:

Bubble risk for halo regions

Watch out with regional bargains 

« Free Investment Property Showcase Events: Auckland, Wellington and ChristchurchConsents trend recovering »

Special Offers

Comments from our readers

No comments yet

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Mortgage Rates Newsletter

Daily Weekly

Previous News

MORE NEWS»

Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.19 4.05 3.95 4.49
ANZ Special - 3.55 3.45 3.99
ASB Bank 5.20 4.05 3.95 4.39
ASB Bank Special - 3.55 3.45 3.89
BNZ - Classic - 3.55 3.45 3.99
BNZ - Mortgage One 5.90 - - -
BNZ - Rapid Repay 5.35 - - -
BNZ - Std, FlyBuys 5.30 4.45 4.35 4.55
BNZ - TotalMoney 5.30 - - -
China Construction Bank 5.50 4.70 4.80 4.95
China Construction Bank Special - 3.19 3.19 3.19
Lender Flt 1yr 2yr 3yr
Credit Union Auckland 5.95 - - -
Credit Union Baywide 6.15 4.95 4.95 -
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 3.99 4.49 -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.80 4.95 -
HSBC Premier 5.24 3.35 3.35 3.35
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.15 3.18 3.18 3.20
Kainga Ora 5.18 4.04 3.95 4.39
Kiwibank 5.80 ▼4.14 ▲4.30 4.64
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - ▼3.39 ▲3.55 3.89
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.25 4.15 -
Pepper Money Near Prime 5.64 - 5.44 5.44
Lender Flt 1yr 2yr 3yr
Pepper Money Prime 5.18 - 4.98 4.98
Pepper Money Specialist 7.59 - 7.39 7.39
Resimac 4.50 4.86 3.89 3.94
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - ▼3.55 3.39 3.89
Sovereign 5.30 4.15 4.29 4.55
Sovereign Special - 3.65 3.75 4.05
The Co-operative Bank - Owner Occ 5.15 3.49 3.59 3.89
The Co-operative Bank - Standard 5.15 3.99 4.09 4.39
TSB Bank 6.09 4.35 4.25 4.69
Lender Flt 1yr 2yr 3yr
TSB Special 5.29 3.55 3.45 3.89
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.34 4.15 4.09 4.49
Westpac - Offset 5.34 - - -
Westpac Special - 3.55 3.45 3.99
Median 5.34 4.04 4.09 4.39

Last updated: 15 November 2019 4:16pm

News Quiz

The maximum remuneration model for Australian life insurance advisers is to be set at what?

Upfront 40% + trail 20%

Upfront 50% + trail 10%

Upfront 50% + trail 20%

Upfront 60% + trail 10%

Upfront 60% + trail 20%

MORE QUIZZES »

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
 
Site by Web Developer and eyelovedesign.com