Auckland Property Market

Auckland Property Market

May 2017 Auckland Property Market:

The Auckland housing market continued to drop in prices slightly through March and April. QV reported that the values in Auckland dropped 0.4% up to the end of April. Barfoot and Thompson reported volumes of properties in Auckland fell to their lowest level since April 2008.

The reason for the drop in volume and price of Properties in Auckland is due to:

1. John Key resigning from the National Party resulting in a drop in confidence in the property market.
2. Restrictions of people being able to get money out of the Chinese market.
3. Banks are tightening up their banking policy making it harder for customers to get funds. Banks ideally need more people depositing rather than borrowing money.
4. The loan to value ratio of 40% being introduced by the Reserve bank last October has hindered people buying investment properties.
5. Fixed interest rates have started to increase in value.

Though sales and prices have slightly dropped what under pins the high property prices in Auckland remain firmly in place. High migration of nearly 72,000 in March and building consents falling by 1.8%. With the Banks also tightening up on Developers a shortage of properties will continue in Auckland.

With interest rates in the USA expected to increase over the 2017 year, you can expect interest rates in New Zealand also to increase. As the affordability of the Auckland property continues to place a strain on people’s income I would expect that volumes and prices will continue to slow. The only saving grace for Auckland is that of the demand for property by the people migration. I would continue to see the property market change from a seller’s market to a buyer’s market. This will mean there will be more properties sold by negotiation rather than auction as the main way to sell your property.