House prices bouncing back, election result brings certainty

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Trade Me expects to see an increase in demand post-election.
Photo: RNZ / Nathan Mckinnon

The country’s housing market is showing more signs of growth with asking prices rising for a second consecutive month.

The Trade Me Property Price Index shows the national average asking price rose 0.4 percent to $840,050 in September, following an identical 0.4 percent increase in August.

Trade Me sales director Gavin Lloyd said the national average asking price was 6.2 percent down on the same month last year but prices were bouncing back with the latest momentum set to continue through the warmer months.

“What we’re expecting to see now that we’re moving past the election in an increase in demand,” Lloyd said.

“We typically see a lift of around 10 percent post-election so we’re expecting to see quite a busy month of November.

“In the short-term what the election result will bring is certainty and the property market loves that certainty.

“People know who’s going to be in government and have more confidence about making decisions.”

Prices in Wellington city were beginning to increase with the average asking price up 1.4 percent on last year to $894,900 in September.

“Prices are still down in the Wellington region – with asking prices 7.3 percent less that this time last year,” he said.

Meanwhile in Auckland, the Index rose 0.2 percent in September with the average asking price currently sitting at $1,134,600 for Auckland city.

Asking prices for apartments, units and townhouses in our main cities in September did not fare so well, with Christchurch taking the biggest hit.

Christchurch’s average apartment asking price slumped 16.2 percent to $652,700.

The average asking price in Wellington dropped 10.2 percent for apartments, units and townhouses, while in Auckland the monthly fall was 7.5 percent.

“High-density housing options dropped in price,” Lloyd said.

“This has come as a bit of a surprise for us. We have seen some really good growth in the Christchurch market so this is definitely a watching brief for us seeing those drops.”

Smaller houses were also coming down in price, particularly 1-2 bedrooms in Auckland, down 11 percent and Wellington, down 4 percent year-on-year.