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Q3 2016: Property Market Update 

Authorised Financial Adviser, Craig Smith shares the latest market updates and analysis from QV....

 

Property Image.jpg

2016 has seen property values continue to rise at rapid rates. This has been the most noticeable in the regions surrounding Auckland. This change began in earnest last year when the Reserve Bank (RBNZ) increased the deposit requirements for Auckland property investors. Further lending restrictions were imposed nationwide in July, with all property investors now requiring a deposit of 40%. The exception being new builds which require deposits as low as 10%. 

So, it’s easy to see why the big question everyone on everyone’s mind is “could this be the end of current boom cycle?”

As per usual, we’ve been watching market developments closely to look for signs of any change in market conditions. In the most recent analysis from QV (to the end of August), we see that values across the country are still rising. Auckland values have risen 15.9% over the previous year and 6.1% over the past 3 months alone. The average now sits at $1,013,632 having broken through the $1m barrier in August.  

However, it’s the regions surrounding Auckland that are now growing at the fastest pace, especially those closest like Hamilton, Tauranga, Rotorua and Whangarei. Hamilton prices have risen 29.3% over the past year and 8.4% over the past 3 months and Tauranga is up 28.5% and 7%. Rotorua has risen 27.1% for the year and Whangarei has returned 21.6%. All of these increases are more rapid than Auckland’s current growth rate. 

So nationally, the property market has positive momentum, with strength coming from the North Island regions. Combined with the fact that interest rates remain at record low levels and immigration at record highs we predict that property will be a hot topic for some time.  

If you'd like to discuss how the recent market changes impact you, simply get in touch today 09 306 5820
Craig Smith | craig@wealthworks.co.nz

 

 
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