Here's where house prices are falling fastest

Friday, 7 September 2018

House price falls aren't even

Suburbs where there has been an oversupply of houses or 'emotional' buyers bidding up prices have suffered the most as Auckland's property market cooled.

QV data this month showed nationwide house prices down 1.6 per cent over the past three months, with falls in Auckland, Queenstown, New Plymouth and Christchurch.

Now data from Homes.co.nz shows the areas where there has been the biggest value change since the city's April 2017 price peak.

Albany Heights has seen median values drop 7.74 per cent. Lynfield is down 6.86 per cent, Pinehill 5.84 per cent, Waiatarua, 5.54 per cent and Golflands 5.53 per cent.

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Albany Heights has suffered an oversupply of housing, one commentator says.

Property developer David Whitburn said there were a number of factors that drove the falls.

Albany Heights and Pinehill were suffering through an oversupply of new housing. The number of buyers in the area had not increased to match it, he said.

Flat Bush was another area where the properties being sold were not in line with demand, he said.

There, land had been going for very high prices – up to $1500 a sq m. 'That's tough when you're a good 45 minutes' drive, outside rush hour, from the CBD.' Prices were down 5.26 per cent.

Paihia prices still haven't recovered to 2007 levels.

Places such as Waitarua and Henderson Valley had more lifestyle blocks, which banks were more reluctant to lend on.

New Lynn appears on the list, but Whitburn said prices were strong there. The change was probably driven by rezoning to higher density, which was allowing more, cheaper townhouses and apartments to be built, lowering the suburb's median value.

Lynfield and Golflands were popular with Indian and Chinese communities, Whitburn said, and owner-occupiers who wanted to purchase properties had been willing to pay more to do so during the market boom. He recalled two auctions where properties went for 20 per cent more than he thought they should have.

Now, few auctions were successful in those areas, reducing the premium that was paid.

Whitburn said homeowners should not worry about the price falls. In most cases they were because of localised factors and the drop was small.

New, smaller developments at New Lynn may be pushing down the median price for the suburb.

Homes.co.nz data also showed big increases in some areas since April 2017 – Long Bay is up 22.5 per cent, Grafton 21.19 per cent and Wai o Taiki Bay up 14.64 per cent.

'We have seen a decreasing trend in the Auckland property market for the last 18 months, but the highest valued suburbs continue to buck this trend,' said chief data scientist Tom Lintern.

'With prices falling, CVs are becoming less relevant. It is not uncommon for properties to sell for less than CV, highlighting the importance to research a property's value carefully and seek advice from real estate professionals.'

Meanwhile new CoreLogic data shows Runanga, on the West Coast, still has prices 14.7 per cent below where they were in November 2007.

Cobden, a suburb of Greymouth, is also well down – more than 10 per cent off its 2007 peak.

Paihia, in the Bay of Islands, was also almost 9 per cent down from 2007, although prices there have recovered 12.4 per cent since 2016.

Biggest drops

Albany Heights – down 7.74 per cent

Lynfield – down 6.86 per cent

Pinehill – down 5.84 per cent

Waitarua – down 5.54 per cent

Golflands – down 5.53 per cent

Tom Lintern says the downward trend has been apparent in Auckland for 18 months.

New Lynn – down 5.41 per cent

Totara Heights – 5.34 per cent

Flat Bush – down 5.26 per cent

Sunnyhills – down 5.05 per cent

Henderson Valley – down 4.92 per cent

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