House Prices dive in Auckland City

The Nelson suburb of Stoke survived the housing slump in the strongest shape - while Central Auckland copped the heaviest hammering. A Real Estate Institute analysis compared the rolling three-month median sale prices for May across 41 suburbs with those for the same time in 2007, ranking the areas by their percentage increase or decrease in value.

While most homeowners have watched their home values slide since the market peak at the end of 2007, Stoke, Pukekohe and Wellington Central defied the downturn, enjoying gains. Papakura's median has stayed the same, and Auckland's Mt Albert has seen only 0.1 per cent shaved off.

In contrast, central Auckland's median has plunged 27.56 per cent - mainly depressed by the ailing city apartment market. Other hard-hit suburbs are Auckland's swanky Remuera and Levin, Onehunga in Auckland, and Manurewa in Manukau.

Nelson also came out on top and Levin languished near the bottom in a regional property market indicator prepared by Gareth Kiernan, managing director of the economic consultancy Infometrics.

His breakdown measured average sales volumes, days to sell and prices across 73 suburbs and towns over the three-month period to May.

The five top-scoring areas are Richmond in Nelson, Auckland's eastern beaches, Titirangi in West Auckland, Albany on Auckland's North Shore and Eastern Wellington.

Marlborough/Kaikoura, Levin, North Otago, the West Coast and Gore still have sales volumes below the national average and days to sell drawing out as buyer demand is still weak in those areas.

Kiernan says the recovery in demand for property over the past few months has been driven by investors and some first-home buyers being drawn back into the market by low interest rates.

Another factor underpinning housing is increasingly positive migration gains.

April's net inflow of 2160 people is the largest since January 2004.

Before we buy too much into "green shoots" hype, ANZ chief economist Cameron Bagrie warns stabilisation is unlikely to be across the board.

"The de-leveraging environment, higher unemployment and rising longer-term, fixed-rate mortgages will be a true test for the housing market over winter," Bagrie says.

Kiernan says buyers remain choosy - if they can't find a property meeting their requirements they won't buy.

Because good-quality houses are in short supply, those in the right location and priced right are selling relatively quickly.

"There seems to be an element of people looking for houses at a reasonable price in favoured suburbs, where previously buyer competition and rapid price rises may have excluded them."

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Posted: 21 Jun 2009