PHOTO: Auckland property market
Despite the extra COVID challenges that Auckland has faced over the past month or two, its property market has continued to track steadily – sales have risen, values have generally increased too (albeit not everywhere), and first home buyers and mortgaged investors are still active. Our measures show that houses in Auckland are currently more affordable (37% of average household income required to service a mortgage) than they have been for more than seven years, and with mortgage rates potentially set to fall even further, there don’t seem to be any obvious reasons for this momentum to end suddenly. Of course, the likelihood that unemployment rises from here is a risk for the property market in Auckland and right across NZ.
Clearly Auckland has had it tougher than the rest of the country in terms of social restrictions over the past 6-8 weeks, so it’s worth assessing how our largest city’s property market is faring. The short answer is that that it has pretty much carried on as if the alert levels weren’t even there.
Starting with sales activity, the rebound in Auckland since full lockdown in April has been solid, and the total for 2020 to date stands at 16,752 – the highest figure for the first eight months of the year since 2016 (22,616). To be fair, that partly reflects strength prior to lockdown over January to March (see the first chart), but nevertheless it’s still been a decent rebound, and August itself was robust. Indeed, sales volumes in August were 37% higher than a year ago, even despite the move back up to alert level three on the 12th.
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