10-10-2013

National affordability improves but regions vary

Landlords.co.nz

1. News
2. 2013
3. October

National housing affordability improved by 1.47% over the August quarter, the latest Massey University Home Affordability Report shows.

There was a $2000 reduction in the national median house price over the quarter, a 72c increase in the average wage rate and a reduction in the average mortgage interest rate from 5.57% to 5.52%.

But on a regional basis, half of New Zealand showed an increase in affordability and half a decrease.

The affordability figure is determined by comparing the average weekly earnings with the median house price and mortgage interest rate.

The six regions showed quarterly improvements in affordability were

• Central Otago/Lakes [6.2%],
• Wellington [3.7%],
• Southland [3.4%],
• Northland [3.2%],
• Auckland [2.2%] and
• Canterbury/Westland [0.7%].

Deterioration in quarterly affordability was evident in

• Hawkes Bay [7.4%],
• Manawatu [3.7%],
• Otago [3.3%],
• Taranaki [2.4%],
• Nelson/Marlborough [2.0%] and
• Waikato [0.4%].

Compared to the year before, national housing affordability improved 2.4%. But again there were regional differences.

Hawke’s Bay reported a big year-on-year decline in affordability, down 10.9%. But Southland’s affordability improved by the same amount and Central Otago/Lakes reported an increase in affordability of more than 11%. Auckland’s affordability declined 2.2% on the year before.

Auckland was the least affordable region, followed by Central Otago/Lakes and Nelson/Marlborough. Southland was the most affordable, at 52.3% of the national average. Manawatu/Wanganui came in second place and Otago third.

Source: Landlords.co.nz