All eyes might be on Auckland, but the latest Quotable Values (QV) data shows it is Hamilton’s value growth that is now streaking ahead of the rest of the country.
By Miriam Bell
Hamilton’s residential property values are taking their turn in the spotlight as they continue to increase at a particularly strong pace, according to QV’s June data.
They have gone up by 29.0% year-on-year and by 6.9% over the past three months.
This leaves the city’s average value at $492,403.
On top of this, values in the surrounding districts are also rising rapidly.
Waikato District values were up by 26.4% year-on-year and 4.7% over the past three months; Hauraki values increased by 18.6% year-on-year and 7.5% over the past three months; and Waipa District values were up 21.3% year-on-year and 6.1% over the past three months.
QV’s Hamilton valuer Stephen Hare said the market is still seeing strong demand with values being driven up as supply is not able to keep up with demand.
High levels of activity and demand at the lower value end of the market ($400,000 to $600,000) from first home buyers and investors is continuing.
But the higher value price bracket ($700,000 to $950,000) is now also seeing a surge in demand, he said.
“More homes now selling in the price bracket and, with the recent rapid value rises in the market, we are now seeing more properties selling over the one million dollar mark.”
Hare said they are seeing first home buyers priced out of the Hamilton market and buying in townships within commuting distance of the city.
“These first home buyers are now also competing with investors looking for better yields.
“It’s likely this surge in activity will slow as prices in these towns catch up with Hamilton lower priced suburbs.”
Cambridge, which is a 30 minute drive from the Hamilton CBD, was a good example of the towns seeing strong buyer demand – including from relocating Aucklanders, Hare said.
“Entry level properties in Cambridge currently sell for between $400,000 and $600,000 and the price to gain entry into the town is now rising rapidly.”
It might be Hamilton which is leading the pack, but values around the rest of the country – including Auckland – have been on the rise too.
The average national value increased by 5.6% over the past three months and by 13.5% year-on-year to hit $590,909.
This is 42.6% above the 2007 market peak – although, once adjusted for inflation, the average national value went up by 13.0%, which left it 21.6% higher than in 2007.
Auckland’s average values continued their renewed rise in June.
They were by 4.7% over the past three months and by 16.1% year-on-year to reach $975,087.
This is 78.4% above the 2007 market peak – although, once adjusted for inflation, Auckland’s average value increased by 15.6%, which left it 52.1% higher than in 2007.
QV national spokesperson Andrea Rush said many housing markets around the country are being driven by strong investor demand, low interest rates, rapid price growth in the Auckland market and strong net migration.
“In terms of the main centres, the Hamilton market saw the highest growth, but Auckland, Wellington and Dunedin markets all saw rapid value growth of between 4.0% and 5.0% over the past three months.
“The Christchurch market also saw a lift in sales volumes, but values continue to rise at a slower rate than the other main centres.”
Rush added that the growing likelihood of further restrictions on property investors might have led to a surge in investor purchases in various housing markets over the past month.
“With the Proposed Auckland Unitary Plan implementation recommendations due this month, it’s hoped this will provide for much needed new housing supply and infrastructure for the growing Super City region to alleviate upward pressure on property values.”