House prices in our largest city have stalled, even dropping slightly between May and June. This is a very different story to the headlines we’re used to reading about surging house prices in Auckland.
The jury is still out about the potential flow-on effect for the rest of the country, but the Wellington region is performing well and holding its own. House prices are up 12.6 percent on this time last year. This is because we still have a shortage of housing and there is a high-demand for homes, despite the tighter lending conditions imposed by the banks.
According to the Trade Me Sale Price Index, looking wider across New Zealand, house prices are up 9.2 percent (excluding Auckland) compared to 2016. This is a strong indicator that centres outside of our largest city are somewhat insulated from what’s happening there. You might hear the term ‘buyer’s market’ start to be used more, but that doesn’t apply in Wellington, Kapiti or the Wairarapa.
First home buyers are doing it tough in Auckland, with data showing the higher house prices and the bank lending restrictions, are having a major impact on their ability to enter the housing market. While house prices in Kapiti and Wellington are lower, if you have been waiting for house prices to start falling, it’s unlikely to happen anytime soon. The old saying ‘patience is a virtue’ still applies to the local house hunt, with the average house price in the Wellington region sitting at $536,150. It can just take a bit of patience for your opportunity to come along, right house, right time!
If you aren’t quite ready to sign on the dotted line yet, it doesn’t mean you shouldn’t do your homework in case the perfect home comes up. We recommend you have the basics covered:
- Seek advice from a reputable mortgage adviser to guide you through the process
- Be ready and thorough in providing what is needed for a mortgage application—work hard to provide what is required. Banks are getting increasingly pedantic on the supporting information
- Get your financials sorted—particularly if you are self-employed by making sure your 2016/2017 financials are available
Winter is traditionally a slower season for buying and selling homes, and with the election just around the corner we will be watching the Auckland and local housing markets with interest. Wellington isn’t showing any signs of slowing down so the heat is still on, even if buyers in Auckland are taking a more conservative approach. If in doubt about your next steps, we’re here seven days a week if you need expert guidance.