NZ median house price reaches record

Median house prices have reached new highs, including in Otago. Photo by Stephen Jaquiery.
Median house prices have reached new highs, including in Otago. Photo by Stephen Jaquiery.

The New Zealand median house price has hit a record $484,650, including an Otago high of $280,000, as national September sales swelled by almost 40% on a year ago.

Auckland continued to dominate the market in total sales and its median price rising 25% from a year ago, from $615,000 to $771,000, but Otago and Waikato/Bay of Plenty also hit record median prices, according to data released by the Real Estate Institute of New Zealand yesterday.

Sales volumes were a feature for the separate Central Otago Lakes area, up 44% from 92 a year ago to 132.

Queenstown prices were up 10% to $690,000 and volumes were up 38%, while the Central area saw prices down 1.3% on a year ago to $380,000 but volumes up 48% to 77 sales.

ASB economist Kim Mundy said prices were being supported by strong inward migration, record-low interest rates and low housing supplies, with expectations the housing market would remain ''very buoyant'' in the months ahead.

However, she noted there was uncertainty around the effects of the October 1 tax changes and the investor loan-to-value (LVR) ratio restrictions that come into force on November 1.

Before implementation of the first LVR restrictions in October 2013, there was a ''flurry of sales'' followed by six months of weaker sales and slower price growth.

''We may see a similar pattern once the new investor measures are in place,'' Ms Mundy said.

REINZ chief executive Colleen Milne said even excluding Auckland from the data, the national median price was up 8.3% to a record $365,000.

She said there was evidence Auckland investors and first-home buyers were going to other regions, notably Northland and Waikato/Bay of Plenty.

However, she also noted that in Dunedin there was ''strong inquiry'' from Auckland investors, backing up anecdotal evidence from other data in recent months.

''The number of [Dunedin] auctions is also on the rise as prices start to trend upwards, an indication of a strengthening market.''

She said the just-implemented tax requirements and imminent LVR restrictions, which see a relaxing of the LVR outside Auckland, could be positive for first-home buyers in the regions.

simon.hartley@odt.co.nz

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