Latest / Making Cents / Auckland House Prices Just Hit a 6-Year Low - But The South Island Is Booming

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Auckland House Prices Just Hit a 6-Year Low - But The South Island Is Booming · Making Cents

• 0:00
  For years, buyers have complained the property market isn't on their side, but boy, has that changed.
• 0:06
  And it's changed in a way that hasn't happened in six years.
• 0:11
  Auckland's average asking price has dropped under a million dollars for the first time since 2020.
• 0:17
  And it's a sign of what's happening elsewhere in the market, with lots of properties around and prices pretty flat overall.
• 0:23
  Vanessa Williams from Realestate Co NZ is our data queen.
• 0:28
  She has been watching all of this unfold.
• 0:30
  I really didn't quite think we would see that number, just under a million dollars for a house in Auckland.
• 0:36
  But even if you've been watching this and thinking, eh, maybe a full blown property crash is next, here's why she doesn't think that's coming.
• 0:44
  Despite wars, despite cost of living crisis, despite geopolitical challenges, and despite the fact that we are having an election year, sellers are just as motivated this year or this last past quarter than they were this time last year.
• 0:58
  So what does it mean for you whether you're buying, selling or just interested?
• 1:03
  Well, welcome to Making Sense.
• 1:05
  It's the podcast people who want financial freedom without giving up their coffee.
• 1:08
  I'm Frances Cook, a financial journalist and fellow financial freedom seeker who makes money simple for you.
• 1:14
  Today.
• 1:16
  Are we in the ultimate buyer's market?
• 1:19
  Making Sense is partnered with Realestate Co NZ to get you the info you need in today's market.
• 1:26
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• 1:28
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• 1:30
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• 1:56
  Welcome, Vanessa.
• 1:57
  Look, we have been seeing some really interesting things in the property market recently.
• 2:02
  Incredibly strong buyer's market at the moment, right?
• 2:05
  Absolutely.
• 2:06
  Kia ora Frances and thank you so much for having me back as always.
• 2:10
  What a fascinating time.
• 2:11
  And I think there has been a lot of chat, especially in the media around elections.
• 2:17
  Are people pausing?
• 2:18
  Are they going?
• 2:19
  Are they stopping?
• 2:20
  Are they starting?
• 2:20
  Like what's really happening?
• 2:22
  And it's fair to say that while it might look like an election, and don't get me wrong, it is a distraction, but is that really impacting the property market at the moment?
• 2:34
  So as I was doing, digging a little into the data, having a Look, and when I looked at the last quarter, so July, September and October, and I compared it to the same quarter last year, there was basically
• 2:47
  the exact same number of houses coming onto the market.
• 2:51
  What does that tell me?
• 2:52
  It tells me that despite wars, despite cost of living crisis, despite geopolitical challenges, and despite the fact that we are having an election year, sellers are just as motivated this year or this last past quarter than they were
• 3:06
  this time last year.
• 3:08
  So clearly there are some sellers out there who can go, you know what, I understand these challenges, I understand that there's markets that might not be, and I use inverted terms in our favour, but you know what, we're
• 3:20
  just getting on with it.
• 3:20
  Anyway.
• 3:21
  It's so interesting because I was literally talking to someone about this from the business perspect, um, where I was like, there's a whole bunch of people who hit pause and they might, you know, get nervous.
• 3:31
  But then the people who are successful often just getting on with it no matter what, they're just like, okay, that's the environment.
• 3:36
  And then we move.
• 3:37
  And I feel like that's very much the vibe in property at the moment where people are looking around and being like, well, there's a whole bunch of stuff happening, but I've got to get on with it and I've
• 3:44
  got to move because there's actually quite a bit on the market as well.
• 3:49
  Right.
• 3:49
  There's quite a number of houses.
• 3:52
  Yes, there is.
• 3:53
  So we're sitting at that around 34, 35,000 mark right across the mutu.
• 3:59
  And that is probably higher than we would typically anticipate.
• 4:04
  But what I would say is that is what's keeping our national average asking price stable.
• 4:10
  So it's basically been stable now since very early 2023 when it dropped down to around the 850 mark.
• 4:18
  And it has basically been 8.50 since the beginning of 2023.
• 4:22
  So the we saw over 900,000 nationally was December 2022.
• 4:29
  And you know, that is a bit of a challenge I suppose, if, you know, as we have that age old debate around as a house, an investment or what.
• 4:36
  But what, you know, when we look at something that has remained at the same rate of, you know, investment or is the same value because of the cost of inflation, of course, things rising, it does actually mean that
• 4:49
  asset is going backwards.
• 4:50
  Technically, that does mean it gives some real certainty in an uncertain time to those who are looking to transact.
• 4:58
  Whether you are looking to sell or to buy, you basically know what you're probably gonna have to buy or sell it for.
• 5:04
  Because it's been so stable for so long.
• 5:06
  Yeah, yeah.
• 5:07
  And I think what's fascinating as well is you know you mentioned the national averages there and they're great for us to be looking at.
• 5:14
  Then when I dig into your figures and get a little bit under the surface of them we've got multiple things happening across New Zealand and the Auckland price under a million for the first time in six years.
• 5:28
  That to me is a very big psychological moment that we've crossed.
• 5:32
  Right?
• 5:32
  Absolutely.
• 5:34
  I really didn't quite think we would see that number but here we are September 2026 and you know, just under a million dollars for a house in Auckland.
• 5:44
  It is a bit of a hard pill to swallow if you're thinking goodness, I was, you know, what does that mean for the equity in my house?
• 5:51
  Well, doesn't mean too much unless you're going to sell if you are an investor.
• 5:55
  Well, you know again are you having to transact if you're a first home buyer?
• 6:01
  Fantastic news.
• 6:02
  But you know if you've got that psychological milestone of under a million dollars and that's the average you've got to remember so there will of course be it flows down to those two one, two three bedroom homes that
• 6:14
  perhaps might be on the earlier side of that.
• 6:16
  And hey if you've got some money in the bank you're thinking, I'm thinking about property investing.
• 6:21
  What could this look like?
• 6:23
  I mean what perfect time.
• 6:24
  And of course dabble in the detail.
• 6:26
  Right.
• 6:26
  Cause just as we were talking about more than one thing happening cause some areas are actually going up where's doing well.
• 6:35
  So the South Island's actually ruling the roost in this area at the moment.
• 6:39
  Couple of reasons for that.
• 6:41
  Firstly if you look at the industries that are doing really well, primary industries, right.
• 6:46
  We have seen that payout in the dairy area.
• 6:50
  We have got exports for our meat and our wool doing very well especially with the way the New Zealand dollar is and so of course that generates industries that are flourishing, that are seeing prosperity so therefore they're hiring,
• 7:02
  they're perhaps able to readjust wages for their staff and of course what happens, people then start to stimulate those little micro economies.
• 7:10
  So you do see the likes of Southland actually doing very well this year.
• 7:13
  They had an all time high average asking price.
• 7:15
  What I will say is for anyone who's been down to Christchurch lately, my goodness, there is a vibe down there, it's buzzing.
• 7:22
  Isn't it wonderful?
• 7:24
  Like they've had such a challenging market for so long, they this year have seen Just a lot of prosperity come into their city.
• 7:32
  They have seen two record average asking prices this year.
• 7:35
  I say the Canterbury region, but that's mainly driven by Christchurch market, of course, the opening of the stadium.
• 7:41
  It'd be remiss of me to not talk about Central Otago lakes.
• 7:44
  Of course, of course they've done really well.
• 7:47
  Average asking price still sitting at around 1.6 million.
• 7:50
  Average.
• 7:52
  You know, isn't that.
• 7:54
  It's kind of nuts.
• 7:55
  I kind of.
• 7:55
  Do you think, did she say 1.6?
• 7:57
  It's as the average as well?
• 8:00
  Yeah, it kind of still.
• 8:01
  I, you know, as I said, keep going back to the data team.
• 8:04
  Are we sure?
• 8:05
  Yes, we're sure.
• 8:05
  Vanilla.
• 8:06
  Okay, okay.
• 8:07
  Okay.
• 8:07
  So.
• 8:08
  And I remember not that long ago around Covid times, you know, Central Otago lakes in Auckland were pretty much at that million dollar mark together.
• 8:16
  And to see that almost 60% more in that area, you know, you've really got a microclimate that's really flourishing in the South Island.
• 8:24
  Yeah, yeah.
• 8:24
  And it's interesting because our property market, I feel like this is the case for a lot of countries but it's very particularly the case in New Zealand where it's such a reflection of what's happening in the broader economy.
• 8:37
  So the things you're pointing out there in terms of the south island doing quite well, the north island as a general rule not doing as good.
• 8:45
  The agricultural area is often driving a lot of it.
• 8:48
  It is like it's very.
• 8:51
  If you want to know what's happening with property, of course you can go to the great real estate.co.
• 8:54
  And said data but you can also look at the wider economy and be like who's doing well, where's booming, where's not doing so well.
• 9:02
  And it's often a very similar trend follows it in property, isn't it?
• 9:07
  The two are so closely linked.
• 9:09
  Yes, they absolutely are.
• 9:10
  And I mean you even just have to go to look at the flip side of where's being a little bit more challenged in the last sort of quarter or therefore 12 months, maybe even 18 months.
• 9:18
  You know, you look at our capital city, Wellington's really seen it.
• 9:22
  It just be really tough over the last, I would say probably even almost closer to two years now.
• 9:28
  And you know, for a myriad of reasons and again you're dead right.
• 9:32
  You go then well what's happening in the property market?
• 9:35
  The Wellington property market has seen it, you know, has, has had a, had a tough time.
• 9:39
  Even seeing the slowdown in rentals tells me that that market has really been quite Unsettled and really, you know, kind of craving just a little bit more green shoots and you know, kind of really wanting to see something
• 9:52
  more positive in that market.
• 9:54
  And you know, hopefully post election we start to see New Zealanders kind of get on with it and the capital follow suit and kind of see some real positive impacts in the capital city.
• 10:04
  Yeah, yeah, I know it's really interesting because I lived in Wellington, I've lived in Wellington twice actually, really enjoyed it and we actually, I like to keep an eye on things and we like to snoop on our old
• 10:13
  house sometimes and they sold it and they got like 20,000 more than we sold it for.
• 10:19
  Now we did give myself props, we did quite well on fomenting a little bidding war.
• 10:25
  So we did sell it for quite a decent price.
• 10:26
  But I was like, whoa, you know, that Wellington market, that's tough.
• 10:29
  It's been years and they got nada.
• 10:33
  So I thought that was, that was super duper interesting.
• 10:36
  When you're looking at this data.
• 10:38
  I mean, one thing that strikes me is how sustained the trend has been.
• 10:43
  Sort of this quite flat market nationally.
• 10:46
  We've got the two speeds happening underneath.
• 10:49
  I've had people mention this to me that they're holding out for a full blown crash.
• 10:53
  They're like, I would love to buy a house, I think it's going to totally crash and then I'm going to pick something up for buttons.
• 11:00
  What do you think of that argument?
• 11:02
  I just can't see how.
• 11:04
  I mean, caveat, caveat, caveat.
• 11:06
  I also didn't see Covid coming.
• 11:07
  So, you know.
• 11:09
  Well, actually to that point there's been two really super duper major a global pandemic and then a war that is physically impacting every single New Zealander.
• 11:20
  Whether it is the cost of your groceries going up because of fuel, the cost of roading which then you have to pay more rates for, or just the petrol pump or the bus.
• 11:28
  And so the fact that house prices haven't dropped below that kind of 850 mark probably tells me that the equilibrium of where people see the value of a home here in New Zealand is sitting three and a half
• 11:44
  years later without any major, hugely external event.
• 11:48
  I just can't see it getting to back to $650,000.
• 11:52
  You know, I mean, never say never, but I just don't know what would have to happen in order for us to see that all drop off quite considerably.
• 11:59
  We can't just build a million houses overnight, of course, that would absolutely drop the price because then of course we'd have an oversupply.
• 12:07
  There's a lot of value held in property in the mindset of New Zealanders as well.
• 12:11
  A lot of people come here because they want to own property.
• 12:14
  You know, globally it's actually a luxury.
• 12:17
  So I do think there will be of course opportunities in every market.
• 12:22
  There will be places that perhaps you deem to be a bargain.
• 12:26
  Sure.
• 12:26
  I'm not saying that that won't happen, but for there to be a full blown crash across the New Zealand property market, I can't see how that would happen.
• 12:34
  But also that would just be a nightmare for our economy given so much of our investment is in housing.
• 12:40
  If you're looking for property, start with realestate Co nz, New Zealand's longest standing property site.
• 12:47
  They've been dedicated exclusively to property since 1996.
• 12:53
  That's even before Google.
• 12:55
  Whether you're buying or renting, no other property site gives you as much information.
• 13:00
  The Market Insights feature lets you view the median asking, sale and rental prices in a suburb for over 1, 3 or even 10 years.
• 13:10
  Want to know what a property is worth?
• 13:12
  The estimated sale price range uses the latest sales figures from the real estate industry.
• 13:18
  Scroll to the bottom of a property listing to discover what it sold for in the past, the council valuation and what you can expect to pay for it even before you view it.
• 13:28
  Become the property expert.
• 13:30
  Download the realestate Co NZ app and make informed decisions fast.
• 13:36
  If someone is looking at this, let's take different people's point of view on this.
• 13:40
  If someone's looking at this and they are a seller and they're like, okay, there's quite a bit on the market right now.
• 13:47
  Prices can be challenging.
• 13:49
  What is actually getting properties sold right now?
• 13:52
  Properties that are well presented, properties that are well marketed and properties that are well priced.
• 14:00
  Those vendors who have let go of what could have been, and I use that in quotation marks and have gone, I want to move, I want to price this property well in this market.
• 14:13
  I am willing to accept a number providing that allows me to move forward.
• 14:19
  Because you've got to remember about 70% of the market are moving from one house to the other.
• 14:22
  So they're buying in the same market anyway.
• 14:24
  So everybody and again I go back to my quote marks is losing or gaining.
• 14:31
  I think that that is something that I really want you to take into consideration.
• 14:35
  Don't skimp on the presentation.
• 14:37
  As I have said before, and I'll say it again, get your harshest friend over and go, what do I need to fix?
• 14:42
  If you walk up if you look at my house from the driveway, what do I need to fix?
• 14:46
  It's their time to shine.
• 14:47
  Absolutely.
• 14:48
  Have at me.
• 14:49
  Roast me.
• 14:50
  Sometimes media headlines can be quite unhelpful.
• 14:54
  So make sure you know your local market, know what your competition is in the market.
• 14:58
  You can find all this online.
• 15:00
  You know how many three bedroom homes are available on your road, on the surrounding roads in your area.
• 15:05
  Come draw on a map and go, right, what's my competition?
• 15:08
  So, you know, make sure that you're not necessarily just looking at those headlines and getting paralyzed by them.
• 15:13
  Yeah, 100%.
• 15:14
  I co.
• 15:15
  Sign everything you said on that front.
• 15:17
  I mean, again, when I think back to that Wellington house and we managed to get quite over the odds, to be honest, in terms of what we sold it for when we did.
• 15:24
  And one of the big things that we invested into was the photography.
• 15:27
  It really did make all the difference in the world.
• 15:30
  Massive declutter.
• 15:32
  And then it was putting it on the market for when I was a bit nervous about the price.
• 15:36
  We really trusted our agent.
• 15:37
  I was like, okay.
• 15:39
  And we ended up getting two people bidding up against each other.
• 15:41
  Now, I'm not saying that'll happen every time.
• 15:43
  It is risky.
• 15:44
  You don't know if you'll get two people bidding up against that.
• 15:47
  But, you know, you also don't have to necessarily accept every bid that comes your way.
• 15:51
  Just got to get people in the door and looking at it.
• 15:53
  Right, Absolutely.
• 15:55
  Yep.
• 15:55
  Allow them an opportunity to see their new life in your house.
• 16:00
  We've got to buy with our head, of course.
• 16:02
  But, you know, when that comes to the home you're going to live in, there is absolutely an element of heart in there.
• 16:07
  And so how do you connect with someone here?
• 16:09
  We know we shouldn't buy with our hearts.
• 16:12
  Trick other people into buying from you.
• 16:14
  From their hearts.
• 16:16
  Absolutely.
• 16:16
  Because we are far smarter because we listen to this podcast so we know we're not going to walk into that room and bid over the odds.
• 16:23
  But get somebody else to do it for you.
• 16:25
  Because you know.
• 16:25
  Because you know best too.
• 16:27
  But no, I do think so.
• 16:29
  It's.
• 16:29
  Yeah.
• 16:29
  If you give them the opportunity to see themselves at home, in your home.
• 16:33
  And of course work with a really good real estate agent who can help you to create that demand.
• 16:37
  Oh, a hundred percent.
• 16:37
  Yep, yep, yep.
• 16:38
  If you know someone who's worked with a good agent and they would recommend them to you, those personal recommendations are gold.
• 16:43
  That's how we found ours.
• 16:44
  And he was, he was worth it.
• 16:46
  Um, okay, now what if someone is A buyer and they're listening to this being like, okay, so prices are down and we're thinking probably not a crash.
• 16:54
  So maybe I move.
• 16:56
  Um, are there any things that they should be keeping an eye out for as they are bargain hunting?
• 17:02
  Part of it is just staying on top of things.
• 17:03
  Right.
• 17:04
  I would really encourage you to think about.
• 17:06
  We have got this beautiful window where prices are stable.
• 17:10
  I don't know what's going to happen in summer.
• 17:13
  The property market does pick up in summer.
• 17:16
  What does pickup look like?
• 17:17
  I'm not sure, but we'll have a government in for another three years.
• 17:21
  So there's an element of stability in the minds of New Zealanders.
• 17:26
  We've had quite a stuck year.
• 17:28
  You know, people are sort of like, okay, what am I going to do?
• 17:31
  What am I?
• 17:31
  And there's a lot of thinking that's happening.
• 17:33
  What I would say is now is probably a really good time if you have the right opportunity, your finances are right, you're feeling good, everybody's all aligned.
• 17:44
  If you can pull that trigger before the election, you're probably going to be in a situation where you've got a bit of negotiating power because there might be others in the competition that aren't quite as bullish as you
• 17:56
  or that are all going to wait till the end of the election and all of a sudden you find yourself in a bidding war.
• 18:02
  So, you know, I just, just take into account a little bit of those things as well.
• 18:06
  There is, as I said, there's a lot of choice on the market, so perhaps be a little bit fussy so you don't get overwhelmed with the choice.
• 18:11
  Narrow it down a bit, set yourself up your alerts.
• 18:14
  Know your local property market.
• 18:16
  There's plenty of data out there on your local property market.
• 18:19
  Go and talk to some people, go and visit some open homes and really just consider the sweet spot now, if you're listening today or before the election, that sweet spot now or perhaps that sweet spot before Christmas could
• 18:30
  be a really good time.
• 18:33
  As I said, I don't know what's going to happen in summer, but demand does lift in summer, so just don't get yourself caught up when perhaps now could be the perfect time.
• 18:41
  Love it so much.
• 18:41
  Thank you so much.
• 18:42
  Vanessa Williams Realestate Co NZ now if this episode was helpful to you, send it to a friend.
• 18:47
  We can all level up our money together.
• 18:49
  Until next time, have a great day.
• 18:53
  This podcast can only give you general information about how things work in most situations.
• 18:58
  It's not individual financial advice.
• 19:00
  If you're after that.
• 19:01
  A financial advisor is always the best bet.