[ad_1]
Dunedin’s once-skyrocketing values have stalled, CoreLogic says.
Average values in Dunedin have risen 81 percent, or nearly $ 245,000, in the past five years, but have been losing momentum since the Covid-19 pandemic.
After an initial stumble during the coronavirus alert level 3 and 4 lockdown, New Zealand house prices have been gaining momentum as the year progresses, with low interest rates, the temporary removal of housing restrictions. the loan-to-value ratio and the lack of listings. pushing the median price to new all-time highs.
“Having topped $ 550,000 in April, Dunedin’s median value has basically been flat for the past five months,” CoreLogic senior real estate economist Kelvin Davidson said in a research note.
READ MORE:
* House prices will continue to rise after Labor ‘inspiring’ victory
* The 2-bedroom house on Island Bay was New Zealand’s most popular listing on Trade Me last month
* Corelogic reveals New Zealand’s most expensive suburb
Alden Williams / Stuff
Dunedin’s once-skyrocketing property values have lost momentum, says CoreLogic’s Kelvin Davidson.
“Similarly, although sales volumes have recovered from the Covid-induced lull in April, the increase has been less than in other major hubs.”
The median days to sell has increased from a low of 21 days in early 2020 to about 29 days, in contrast to the reduction in the number of days to sell from other centers.
Investors have jumped in the past three years and led the Dunedin market this year, with 27 percent of property purchases. This was followed by moving companies, with 26 percent, and first-time home buyers (25 percent).
“The time to market has been lengthening lately and the increasing presence of investors may be leading to more difficult negotiations when it comes to buyer offers,” Davidson said.
“It seems unlikely that Dunedin stocks are about to fall sharply, but the decline in affordability over the past five years may mean future growth slows down.”
Dunedin’s slowdown was not a surprise, as homes became increasingly unaffordable due to large increases in property values.
Home affordability had decreased in particular when comparing the value to people’s income, but also when weighing mortgage payments as a percentage of median household income.
John Bisset / Stuff
Average values in Dunedin have risen 81 percent, or nearly $ 245,000, in the last five years.
“Even despite falling interest rates in recent years, mortgage payments currently absorb 32 percent of median income in Dunedin, up from 27 percent five years ago,” he said.
“The bottom line is that reduced housing affordability tends to act as a long-term constraint on the housing market.”
The New Zealand Real Estate Institute said in its latest property report, from September, that even though the median city price of Dunedin hit a record $ 568,000 for the month, there were 17 weeks of inventory, seven weeks more than the previous year. Reinz also noted that its home price index in the Otago region was the worst performing in the country in the past 12 months.
Separately, ASB Senior Economist Mike Jones said Wellington, Waikato and Nelson were the tightest real estate markets in the country, as measured by the ratio of sales to listings. Northland and Southland were at the opposite end of the spectrum.
“Sales / listings are above average for all regions, showing that all markets are currently tight,” Jones said.
“This even extends to those regions that were particularly affected by Covid, such as Otago.”
The buyers were almost exclusively New Zealanders, he said.
“The latest property transfer statistics show that the share of non-residents in the New Zealand property market has continued to decline to next to nothing following the imposition of the so-called foreign buyer ban in October 2018.”
