About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   tmmonline.nz  |   landlords.co.nz
Last Article Uploaded: Wednesday, June 19th, 9:08PM
rss
Latest Headlines

No let-up in affordability issues

Housing affordability has improved in New Zealand’s most expensive regions but it’s deteriorating on a nationwide basis.

Tuesday, February 12th 2019, 11:46AM 1 Comment

by The Landlord

Massey University’s latest Home Affordability Report is out and it shows a quarterly decline of 2.2% in national affordability, driven by increases in median house prices.

The report, which covers the quarter from September to November 2018, shows an average increase in median house price of 4.6% across all regions.

This was only partially offset by wage increases in most regions and lower mortgage interest rates.

Massey University’s David White, who is the report’s author, says median house prices increased in some unexpected regions.

“For example, house prices in Southland went up by 15.5% and in Taranaki they increased by 13.7%, although both of these regions have seen solid wage growth in the past quarter.”

In contrast, New Zealand’s most expensive regions – Auckland and Central Otago Lakes – flew below the radar in terms of median house prices.

Auckland saw a modest median price increase of just 1.6%, while Central Otago Lakes’ median price increased by 10.6% but off a low base from the previous quarter.

As a result, Auckland’s affordability improved by 0.8% over the last quarter. It also showed improvement over the relevant 12-month period.

The only other region to exhibit greater affordability over the last quarter was Waikato (by 2.1%). Over the 12-month period, half of the regions showed affordability improvements, including Central Otago Lakes.

White says that, after Canterbury/Westland where affordability improved by 9.3% over the past year, the biggest improvements actually came from the country’s most unaffordable regions.

“Auckland became 7.5% more affordable over the past year, and Central Otago Lakes showed a 5.3% improvement.

“Unfortunately, for those looking to buy a home in these regions, they still remain the least affordable places in New Zealand.”

Central Otago Lakes is currently 60% less affordable than the rest of New Zealand, with median prices there at 14.6 times the annual wage in that region.

Auckland remains 42% less affordable than the rest of New Zealand, with a house price-to-income ratio of 12.9.

White says the big picture trends show that, after a short reprieve, home affordability over the past 12 months has now continued to decline in half of New Zealand’s regions.

“While improvements in incomes and interest rates are helping would-be homebuyers, these are being outstripped by rising house prices in many regions.

“This is reflected in the fact that across New Zealand, the house price-to-income ratio has deteriorated from 8.8 to 9.1 times annual wages over the last quarter.”

Southland remains the country’s most affordable region, despite becoming considerably more unaffordable over the last quarter.

 

Tags: affordability house prices housing market Massey University\ property investment

« Free Investment Property Showcase Events: Auckland, Wellington and ChristchurchSong of subdued values remains the same »

Special Offers

Comments from our readers

On 13 February 2019 at 5:15 pm John Butt said:
These guys are continuing to run a story about affordability that is an utter nonsense. When did any bank last do a price/wages calculation before offering a loan.
Banks typically calculate affordability as mortgage payments with principle included (not price), divided by household income (not wages) - an extremely different calculation.
Please improve reporting on this one - Here is a government supplied index which is far more accurate: https://www.mbie.govt.nz/building-and-energy/tenancy-and-housing/housing-affordability-measure/the-housing-affordability-measure-for-potential-first-home-buyers/

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
  • A Capital Offence
    “Who ever made the decision to build all these 100s of units all at once must have rocks in their head. This philosophy of...”
    12 hours ago by Maxwell K
  • FSLAA starts June 2020
    “If I've got this right, this announcement means that the implementation of the new regime has slipped by another 4 months...”
    17 hours ago by Murray Weatherston
  • KiwiSaver and risk, how far out of bounds are we?
    “I think the situation under the rules that have been promulgated so far is actually quite clear. Under the new regime, when...”
    17 hours ago by Murray Weatherston
  • FSLAA starts June 2020
    “Great, just set up the application process and send us forms, so we can get on with it please? ...”
    18 hours ago by AdviserMan
  • FSLAA starts June 2020
    “While I know current AFA's will get through the new regime without too much in the way of hassles, I equally know that current...”
    18 hours ago by Comprehensive Planner
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 5.69 4.39 4.35 4.55
ANZ Special - 3.89 3.85 4.05
ASB Bank 5.70 4.45 4.39 4.55
ASB Bank Special - 3.95 3.89 4.05
BNZ - Classic - 3.89 3.95 3.89
BNZ - Mortgage One 6.40 - - -
BNZ - Rapid Repay 5.85 - - -
BNZ - Std, FlyBuys 5.80 4.69 4.59 4.79
BNZ - TotalMoney 5.80 - - -
Credit Union Auckland 5.95 - - -
Credit Union Baywide 6.15 4.95 4.95 -
Lender Flt 1yr 2yr 3yr
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 - - -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.60 4.75 -
Housing NZ Corp 5.80 4.69 4.49 4.45
HSBC Premier 5.89 3.79 3.79 3.89
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
Lender Flt 1yr 2yr 3yr
ICBC 5.65 3.85 3.95 3.89
Kiwibank 5.80 4.60 4.60 4.84
Kiwibank - Capped - - - -
Kiwibank - Offset 5.65 - - -
Kiwibank Special - 3.85 3.85 4.09
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 6.10 4.89 4.99 -
Resimac 5.30 4.86 ▼4.14 ▼4.19
RESIMAC Special - - - -
SBS Bank 5.79 4.85 5.05 5.49
Lender Flt 1yr 2yr 3yr
SBS Bank Special - 3.89 3.99 3.99
Sovereign 5.80 4.45 4.39 4.55
Sovereign Special - 3.95 3.89 4.05
The Co-operative Bank - Owner Occ 5.65 ▼3.89 ▼3.95 4.05
The Co-operative Bank - Standard 5.65 ▼4.39 ▼4.45 4.55
TSB Bank 5.69 ▼4.45 4.49 ▼4.55
TSB Special - 3.95 3.99 4.05
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.79 4.69 4.79 5.19
Westpac - Offset 5.79 - - -
Westpac Special - 3.89 3.85 4.05
Median 5.80 4.45 4.39 4.19

Last updated: 19 June 2019 9:13am

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