Homes in more than third of Auckland suburbs have defied the market slowdown and risen in value, thanks to first-home buyers, according to the latest OneRoof housing market figures.
But the city is also home to some of the country's biggest house price drops.
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Nine out of 10 of New Zealand's biggest fallers in median house values are in Auckland, including the country’s wealthiest neighbourhood, Herne Bay, which fell 12 per cent to a new median value of $2.19 million.
The OneRoof and Valocity figures, published in Tuesday's OneRoof Property Report, shows the Auckland market is still strong in Papakura and Rodney, where house values rose by more than two per cent in the last 12 months, but has fallen by more than five per cent in the North Shore.
Just under 20 per cent of Auckland suburbs experienced value drops of more than 5 per cent and seven suburbs - Kumeu, Whitford, Albany, Herne Bay, Pukekohe East, Ti Point and Sunnynook - suffered double-digit slumps.
Sunnynook also dropped out of the million-dollar median value club, as did fellow North Shore suburbs Northcross, Hillcrest, Rosedale and Torbay.
Sunnynook's median value was $1.14 million a year ago, but is now $995,000. However, that’s still up from three years ago when the suburb’s value was just $720,000.
Kumeu on the city’s north western fringe is New Zealand's biggest faller, down nearly 18 per cent on a year ago (from $1.455 million to $1.195 million), while Albany is down just over 12 per cent, off $140,000 from its high of $1.145 million last year.
While Herne Bay has fallen from last year’s peak of $2.49 million it also clocked Auckland’s second highest sales price - $12 million for a mansion on Marine Parade in November, suggesting there is more than meets the eye.
OneRoof editor Owen Vaughan says the swings in median values are not surprising – not because values are dropping across the board, but because of the change in the sorts of properties now selling.
"Price is driving much of the house value growth in New Zealand. The six regions and towns that have experienced the biggest leaps in median house values in last year are Wairoa (29.1 per cent); Opotiki (25 per cent); Tararua (25 per cent); Kawerau (21.9 per cent); Hawke’s Bay (21.4 per cent); and Whanganui (20.4 per cent); and they all have median house values of less than $400,000.
"Price is also behind the big drops in Auckland. When we look into what is selling in the city, there is a greater share of lower priced stock than a year ago and lower price points are popular with first-home buyers, who now represent the largest share of new mortgage registrations in the city - more than 27 per cent.
"The impact of this on headline value movements for a suburb can sometimes be misleading as it may appear a suburb is declining or collapsing in value, when in fact there has simply been a bigger share of lower priced housing selling."
James Wilson, head of valuation at OneRoof’s data partners Valocity, says the lack of active in the higher price brackets is the result of home-owners deciding not to sell until the market picks up or withdrawing if prices don’t meet their expectations.
“Because the upper end of Auckland's market is not as active as it once was and there’s more activity in the lower price brackets median values have dropped in some of the city's wealthier suburbs.
He says some of the suburbs that have taken a hit in the North Shore were some of the fastest rising in previous years, and particularly popular with overseas investors.
“They had higher value because of that coastal influence, good housing stock and proximity to good schools, they grew faster and reached higher price points,” he says.
“But now there’s anecdotal evidence that in a generally less heated market, they’re also seeing the ‘double whammy’ of fewer foreign buyers.”
On the other side of the harbour, Lynfield, Three Kings and The Gardens, near Manurewa, dropped below one million dollars to between $930,000 and $990,000. But other parts of the south are growing. Manukau, Otara, Mangere showed some of the biggest leap in median values with between 4.6 and 5.2 per cent rise over the past year.
Wilson sees that as a switch in buyer types, as investors in those formerly landlord-attractive suburbs are being replaced by more first home buyers.
“These suburbs are still well priced – between $505,000 and $665,000 – so they’re attracting first home buyers who are buying slightly better properties, at higher prices, because they want to live in these houses themselves.”
“These median value rises and drops are just reflecting the composition of who is buying and selling, it’s not a massive drop to entirely different brackets.”
He points to Kingsland, which dropped 6.5 per cent on a year ago, as a clear example of a median values affected by the changing mix of housing stock on the market as availability of apartment blocks, attached flats and character houses comes and goes depending on the mix of buyers.
“Overall around the country, it’s very much thinking about ‘who is playing in the game’ right now,” Wilson says.
