House prices in Auckland, New Zealand, look set to continue rising throughout this year after a buys month of March, and rents are also up, the latest index figures show.
The average sale price for the month was $866,782, and the median price was $798,000, according to the latest data monthly report from real estate agents Barfoot & Thompson.
The March average sales price was the third highest on record, within $10,000 of the all-time high in November last year, and 5.4% higher than last month while the median price at $798,000 is the second highest on record, within $2000 of the all-time high in December last year, and up 8.1% on February’s median price.
‘March is always one of the busiest sales months of the year, and a good indicator of where prices are tracking for the remainder of the year,’ said Peter Thompson, managing director of Barfoot & Thompson.
‘When prices are this strong in March the trend is for prices to hold steady through the year.
As it has been for the past two years, lack of supply remains the main price driver. New listings in the month at 1,874 were solid, but by month end, the number of available listings at 3,093 was a decline of 6.8% on the number the month previously,’ he pointed out.
‘There has been a definite increase in the number of properties being sold under the hammer at auction, indicating keen buyer competition for available properties. Although a record number of building permits are being issued, and new homes are springing up everywhere, Auckland is simply not building homes fast enough to keep up with the growing population,’ he added.
He also pointed out that Statistics New Zealand reported that in February alone the population of Auckland increased by about 3,000 people. Based on the Auckland average occupancy for houses, of three people to a property, theoretically 1,000 additional properties would have had to become available in the month to house such growth.
The data also shows that in March the firm sold 474 properties for in excess of $1 million, the highest number ever in one month and it represented more than a third of all properties sold.
At the other end of the scale, 146 properties, or 10.9%, sold for under $500,000.
Data from the firm also shows that the average weekly rent for one bedroom properties has risen by 4.8% from $316 to $331 year on year, while for two bedrooms rents are up 6.3% from $398 to $423.
Rents for three bedrooms are up by 5.6% from $486 to $510 compared with March 2015, four bedroom rents increased by 5.1% from $614 to $644 and for five or more bedroom rents were up by 5.8% from $755 to $791.
Thompson explained that Auckland's usual rise in rent didn't occur in March and over the last 12 months, Auckland saw an increase of $28 or 5.8% for all property types. However in the past month, the increase was only by $1.
Rodney and Franklin/Manukau continue to show the fastest growth in rental prices, with an 8.4% increase in Franklin/Manukau and 7.8% increase in Rodney in the past 12 months.
Even with the marked increase in rent each month, Franklin/Manukau remains the cheapest area for rentals across all property sizes.
Over the past few months, there has been a marked increase in the rental prices achieved in Auckland's outlying areas, such as Franklin, Manukau and Rodney, the data shows and Franklin, Manukau and Rodney have been outperforming the rest of Auckland when it comes to rental increases.
In the past two years, Auckland's rents have increased by 9.24%, whereas in Franklin/Manukau, they have increased by 11.26% and in Rodney, by 11.39%.
Thompson said that Franklin/Manukau is typically the cheapest area to rent in, but with rental increases now significantly above the average, Franklin/Manukau prices are getting closer to the averages seen in South Auckland.
‘The rental increases in these outlying areas suggest that Aucklanders are struggling to find suitable properties in closer suburbs, or are happy to travel further afield to find the right home,’ he added.