An increase in New Zealand homebuyer confidence has led to a surge in the real estate market. Quick sales and higher prices could be evidence that the market is on the upturn, however, some analysts are warning that the rise in prices could be temporary. See the following article from Property Wire for more on this.
Residential property prices in New Zealand are increasing towards last year’s levels with apartments proving particularly popular, according to the latest research.
After four months of improvement the average house price rose to $385,426, up from $382,758 in July. Prices are now just 2.8% below what they were in August last year, the official figures from QV Valuations show.
This follows a 5% annual decline reported last month, which was an improvement on the 7.1% of the previous month. But analysts are warning that the rise could be a temporary surge caused by demand currently outstripping supply.
Glenda Whitehead, QV Valuations manager, said sales activity in August was solid and the number of sales had picked up from last year’s lows when plenty of properties were on the market.
Quick sales and higher prices were the result of various factors such as the advent of spring, a revival in buyer confidence, many buyers chasing properties and a shortage of listings.
But a correction could be on the horizon. ‘If more properties come on to the market in spring, as expected, then the imbalance of motivated buyers and the shortage of quality properties could be corrected and values stabilize,’ she explained.
However as the price increases are across the country there is a belief that it could be a sustained recovery. In the Auckland region, the annual decline in values improved to 1.9% from 3.5% in July.
However prices are falling in the Auckland apartment sector, according to some new research, but they are increasing elsewhere in the country. According to the latest data from Crockers Auckland apartment prices have fallen in the past year from an average of $300,000 to $265,000.
But analysts point out that because Auckland dominates the country’s apartment market with the most stock, this drags down the national figures and elsewhere the condo market.
This could be due to apartments outside Auckland being generally of a higher quality, and fewer being available.
This article has been republished from Property Wire. You can also view this article at Property Wire, an international real estate news site.