House values in half of New Zealand’s suburbs in decline

June 23, 2022 8:00 am

An old house with a view of Auckland's city centre skyline. [Photo Credit: RNZ]

New figures show house valuations in half of New Zealand’s suburbs are now in decline, as three Auckland suburbs see median values fall by more than $90,000.

A new Mapping the Market report from CoreLogic NZ, released on Thursday, showed over 400 suburbs had entered a “downswing” in median value since March. Just under 300 suburbs still saw median house valuations increase by at least 1%, however.

CoreLogic NZ’s chief property economist Kelvin Davidson said “the signs of weakness” in the housing market were now “very clear”.

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“In dollar terms, the largest drop in the last three months has been in Auckland’s Point Chevalier where the median value fell $104,400 (4.6% fall).”

In the company’s data, 11 suburbs declined in median value by 5% or more, including suburbs in Auckland, Dunedin, Upper Hutt, Lower Hutt, and Porirua.

Meanwhile, 23 suburbs saw their value increase by more than 5%

“The larger gains of 5% or more tend to be in our smaller areas, including parts of Waikato district, Far North, Southland district, Central Otago district, but also a handful in main centres,” Davidson said.

“There’s certainly evidence of volatility across the New Zealand market, and we’ll have a clearer picture of which suburbs have been impacted the most in the coming months. But what is clear today is that value falls are now fairly broad-based, both geographically and by value band/tier.”

In Auckland, only 24 out of 206 suburbs saw median values rise above 1% since March, with 119 instead seeing drops of at least 1%, according to CoreLogic.

There were 36 suburbs in Auckland with median value drops of less than 1%.

“Along with Point Chevalier, Pakuranga Heights and New Windsor also saw median values fall by at least $90,000 in the past three months. Herne Bay is still Auckland’s most expensive suburb, albeit values have dipped 1% since March.”

In contrast, CoreLogic said Christchurch’s housing market had “generally been resilient” in the past three months with only four out of 85 suburbs seeing a drop of 1% or more since March. In contrast, 31 suburbs continued to grow by at least 1%.

But in Wellington, Davidson said there was an “emerging weakness” in the market.

“Only Lyall Bay and Wellington central have recorded gains of 1% or more since March. By contrast, 64 out of 97 suburbs saw falls of at least 1%, with five having drops of at least 5%, including Petone and Alicetown,” the economist said.

Hamilton has also seen more than 50% of its suburbs drop in value by 1% or more. Hamilton Lake, Hillcrest, and Flagstaff were down by more than 4%. But prime suburbs of Beerescourt and Baverstock have seen increases of more than 5%.

Meanwhile, Davidson said Tauranga’s housing market was holding up “a bit better than elsewhere”.

“Only Parkvale and Gate Pa have seen falls of 1% or more since March. Indeed, areas such as Tauranga (suburb) and Papamoa have continued to rise by 2% in the past three months.”

But Dunedin’s market had “definitely turned down”, according to CoreLogic, with 45 out of 62 suburbs seeing median values dropping by 1% or more.