Property market takes a big breather on house prices

The property market is cruising after years of turbulence and big increases in house prices.

Buyers are now being asked to pay on average $600,850 nationally for a new home.

This is up a modest 0.6% on August, the latest Trade Me Property Index figures show.

Across the country the market is “levelling out,” Trade Me Property head Nigel Jeffries says.

“With month-on-month increases of 1% or lower over the past five months, it looks to be taking a bit of a breather.”

"Still, the average asking price increased by 6% over the past year. While this is impressive, it is relatively calmness after the 10-16% annual increases in previous years.”

Auckland had slowed the most but the average asking price hit $871,800 last month, up 1.5% on August.

Mr Jeffries says Auckland’s average asking price is up 12% on last year, which is strong growth but a huge slowdown on the 20% rises in recent years. 

“It’s incredible that another record average asking price equates to a slowdown, but there’s a definite easing after the frenzied growth of the past couple of years.”

Outside Auckland, the property market is also reaching record highs, with the average asking price hitting $450,000 for the first time.

This is 10.2% higher than the same time last year and at $450,200 it is an increase of $41,550 over the past year.

The star performers of the market are Waikato and the Bay of Plenty. Waikato has had a 20% jump in average asking prices in the past year to a record $467,400.

The Bay of Plenty has its 12th successive month of record highs in September, hitting $551,100, up $150,000 over the past three years.

Nelson has broken the $500,000 barrier for the first time as the average asking price in the region reached $505,800, up $48,050 in the past year.

Big ticket homes on the rise
Big houses – five-plus bedrooms – are “rocketing” ahead, Mr Jeffries says.

The average asking price for these properties is now well over $1 million and showing no sign of slowing down.

In Wellington growth has been particularly strong, with big houses hitting $807,600, up a massive $173,600 on last year.”

Urban properties facing headwinds
The average asking price for urban properties has grown steadily over the last couple of years but is slowing down and lagging behind the overall market.

Mr Jeffries says the Auckland apartment market had calmed down from highs of more than 40% year-on-year to a much more modest 2.8% increase in the year ended September.

Average asking prices for urban property in Wellington had kept “ticking over” with all types showing solid increases of between 11-12% over the past year.