OneRoof Property Report: Home Loan Deposits Soar By $ 41,000 In One Year


Watch: The latest OneRoof property report shows Auckland’s ‘affordable’ suburbs, defined as those with median house prices below the government’s affordable KiwiBuild bar of $ 650,000, have fallen to just three in the city ​​limits.

Soaring prices are forcing buyers to pay typically $ 41,000 more for a home loan deposit than a year ago, as Auckland’s “affordable” housing market shrinks to a handful of suburbs.

Coastal Herne Bay’s median prices, in particular, have surpassed $ 3 million, setting a new record as the only suburb in the country to cross the magic bar.

Highlighting the challenges faced by first-time homebuyers, there were only three Auckland suburbs left within city limits with median house prices below the government’s affordable KiwiBuild bar of $ 650,000. , according to the latest OneRoof property report.

This was down from 26 a year ago and 47 five years ago.

Even more strikingly, Auckland’s 195 suburbs now had median property values ​​of over $ 1 million or more, which is 71% of the city.

OneRooof editor-in-chief Owen Vaughan said first-time homebuyers, in particular, now typically hand over $ 200,000 or more for a deposit.

“Even parts of the city that were considered affordable or low value, such as Mangere and Manurewa in South Auckland, have seen property values ​​jump over 20% to over $ 800,000,” did he declare.

“However, recent auction results show that even sales of over $ 1 million are not uncommon in these areas.”

Just a year ago, the outlook was very different. Most experts have indicated that house prices will fall in hopes that Covid-19 will wreak economic havoc in the country.

Instead, record interest rates and a lack of housing supply have caused prices to skyrocket in what has been called the biggest housing boom since the mid-2000s.

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Auckland’s median price was now at $ 1.1 million, jumping an incredible $ 205,000 or 23% since the Covid-19 pandemic struck 12 months ago.

Prices on the North Shore increased again, climbing from $ 255,000 to $ 1.3 million.

This meant that the typical North Shore buyer now had to raise a deposit of $ 262,000, $ 51,000 more than a year ago.

The suspension of so-called loan-to-value restrictions – which gave investors and homeowners better access to home loans – also played a role in the price hikes.

This has often left first-time homebuyers opposed to investors for cheaper homes, said Wayne Shum, senior research analyst at OneRoof data partner Valocity.

“This has pushed many of Auckland’s so-called affordable suburbs a striking distance from a median real estate value of $ 1 million,” he said.

There were now only eight suburbs with median real estate values ​​of $ 650,000 or less.

However, of these, five were in rural areas, meaning only Auckland Central, Grafton and Manukau, full of apartments, had median prices below $ 650,000 within city limits. .

Auckland Central remained the most affordable, with a property typically costing $ 495,000.

The number of suburbs with median real estate values ​​between $ 650,000 and $ 900,000, meanwhile, has also fallen from 73 to 38 in the past 12 months.

Prizes at Mangere East ($ 235,000), Manurewa East ($ 220,000), Clover Park ($ 210,000) and Otara ($ 205,000) were among the big jumpers. Each had median prices below $ 650,000 a year ago, which had now risen in value by more than $ 200,000.

Ray White Manukau owner Tom Rawson recalled a Papakura property with development potential that sold for $ 635,000 last April.

However, as of Tuesday, three similar nearby properties all sold at auction for over $ 950,000, an increase of over $ 300,000.

At another auction Thursday, Rawson made a bid on behalf of a buyer willing to pay $ 1.3 million – or $ 500,000 above the board’s valuation – for a Point home. England.

However, Rawson’s client was quickly knocked out of the auction by two developers, who increased the price by an additional $ 145,000 – with the losing developer ultimately left the room for their valiant defeat.

In a third auction led by Ray White, a woman bought a house. Her sister – with whom she bought the house – had meanwhile gone to another auction at the same time, ready to bid on the second house if she didn’t get the first, Rawson said.

This not only showed a growing tendency for siblings and friends to buy together, but also how flexible and pragmatic buyers needed to be to enter the market, he said.

The exclusive Herne Bay, meanwhile, was still home to New Zealand’s most expensive homes, with a median price of $ 3.005 million, up $ 455,000 in the past 12 months and over $ 1 million. dollars in five years.

There were also 17 suburbs with median values ​​of $ 2 million or more, up from four a year ago.

“While the cost of servicing a mortgage has never been lower, deposit requirements have never been higher,” Vaughan said.

“The road to homeownership is particularly steep in Auckland; first-time home buyers with deposits of $ 130,000 have, in fact, been excluded from 98% of the city’s suburbs.”

“The only options available to them are to move to the outskirts of town, buy off-plan, or fight over a small group of KiwiBuild homes.”

Elsewhere in the country, buyers were also suffering, with the typical New Zealand deposit surging from $ 28,000 in 12 months to $ 153,000.

Wellington’s prices rose even more than Auckland’s, climbing 27% in 12 months to $ 1.025 million.

First-time homebuyers in the capital now typically had to save a deposit of $ 205,000 – $ 43,000 more than a year ago and $ 98,000 more than five years ago.

Median prices in Christchurch, by comparison, remained relatively affordable at $ 535,000 despite a 16.9% jump after the lockdown. This equates to a down payment of $ 107,000 for first-time homebuyers, $ 27,000 more than a year ago.

First-time homebuyers in Invercargill and Queenstown Lakes have been the least affected by the post-containment outbreak, albeit for different reasons.

The typical deposit requirement at Invercargill only increased from $ 15,000 to $ 64,000, with the city’s median price reaching $ 395,000. Queenstown Lakes’ filing requirement has increased by $ 16,000, the result of the city’s economy being hit hard by the ban on international visitors and struggling housing prices after the lockdown.

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