June 2019 Property Update
The June residential property sales data was released on 12/07/19. The heading for the data released was – Number of Properties Sold Nationally falls in June, but Prices Keep Rising!
Behind this statement lies a message. The message seems to be that many buyers are holding off hoping prices will fall. The probability however is that prices will keep rising. Why?
Firstly there is a housing shortage especially in major centres like Auckland. Secondly the population is growing due to both internal growth and by net migration.
The cost of building is increasing due to both labour costs (shortage of builders) and materials. Higher building standards – better insulation, ventilation, heating and damp proofing all add to the cost of a house.
Then there is low mortgage interest rates which means home owners do not have to sell as mortgage payments are more affordable. As a result there are less houses for sale which
results in more buyers for less houses resulting in rising prices.
The shortage of homes for sale and higher costs of the Healthy Homes Regulations means rental costs will continue to increase. Then there is history. History tells us that for the last 75 years house prices have continued to increase over time.
Grandparents talk of buying their house in the 1960’s for £3,000 (about $6,000 today). The same house today in Auckland would be around $900,000. When is a good time to buy? The answer is now!
So what were the numbers?
For New Zealand sales numbers were down 4.0% to 4159 compared to the same time last year. For Auckland sales were down 3.2% to 1,819. Big falls in number of sales were:
Hawkes Bay – 26.8% = 210 sales
Taranaki – 24.9% = 139 sales
Tasman – 13.9% = 62 sales
West Coast – 11.8% 30 sales
June sales across New Zealand were the lowest June figures for 5 years. June was also the lowest month for new listings since records began.
What about Prices?
Median house prices across New Zealand increased by 4.5% compared to June last year and is now at $485,000. In Auckland median prices remained stationary at $850,000, the same since June 2018.
Median price changes for the past year saw increases in 12 out of the 16 regions with 3 (Auckland, Waikato and West Coast) being static. Only one (Marlborough –1.1%) showed a fall in price. The average time to sell increased by 3 days to 41 days, compared to last year.
Plumbing Issues Can Be Costly
The problem with leaks in plumbing is that they cannot always be seen. The pipework carrying water throughout the home to the kitchen, bathrooms, Landry and W/C is usually behind the wall linings. What does this mean for your home maintenance?
This means a slow leak can go undetected for a long period of time causing water damage to the structure. By the time the water leak shows itself the damage can be extensive and the cost to repair can be high.
A home maintenance builders report from A Buyer’s Choice Home Inspections can detect unseen moisture inside the walls. Early detection can save a lot of money in repairs.
Worst of all the usual house insurance does not normally cover “gradual damage” from slow leaks. A bust pipe which floods the house would be covered but not a slowly leaking pipe behind a shower for example.
To strip out a leaking shower, repair the floor, wall and reinstall the shower can cost thousands of dollars. Having an A Buyer’s Choice Home Inspections building report produced as part of a home maintenance programme can be a wise investment.