House prices drop in June

Any optimism shown by local property agents was dealt something of a blow last week, with CoreLogic’s latest house price index showing further declines or stagnation.

In June, average prices in Auckland as a whole were down -1.2% over the month to $1,263,937, taking the quarterly fall to -2.6% – the largest quarterly drop in prices since August.

Closer to home, CoreLogic NZ found the average property price in North Rodney was now $1,289,392, a quarterly drop of 4.5%.

The news was a little less bleak in Kaipara, where quarterly prices increased by 1.8% to an average value of $867,430.

CoreLogic NZ Head of Research Nick Goodall said the last 12 months in New Zealand could be described as “a dead cat bounce”.

“Inflation has remained sticky, particularly domestically, as the Reserve Bank of NZ has stayed true to its commitment of using monetary policy to bring consumer prices under control,” he said. “It looks as though interest rates could stay higher for longer, restricting borrower numbers and lending amounts.”

Goodall said Auckland’s price drop was “somewhat of a surprise, but likely a reflection of affordability challenges”, considering that the proportion of average income needed to pay a typical new mortgage in Auckland was now 55%, compared to just 43% in Dunedin.

While prices might have dropped since 2022, it’s worth remembering that any decreases are coming from a very great height – the CoreLogic stats show that since the last market peak, in 2007, house prices in Kaipara had risen by 118.7% and in North Rodney by 114.7%.