Crockers Market Research - august 2013 web.pdfFebruary March April May June July August September October November December Median price 2009 Median price 2011 Median price 2010 Median
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Crockers Market Research Issue 93 • August 2013
Crockers Property PO Box 74054, Greenlane, Auckland 1546525 Manukau Road, Epsom, Auckland 1023 T 09 630 8890Crockers Property Management Ltd and Crockers Realty Ltd, Licensed (REAA 2008)
Topics this month • Apartment Review of the 4 Metros: Akld, Wgtn, Chch, Dun vs NZ • Auckland and NZ Apartment Distribution• CPII Survey Results - High Density Living • Auckland Rental and Sales Review
T his is in part due to an increasing average sales price and therefore those apartments that were previously less than $150k are moving into this next price bracket. A similar shift has also occurred at the upper price brackets, with apartments in the $350k-$499k level reducing in proportion, as the proportion of more expensive apartments in Auckland increased.
Auckland and NZ Apartment DistributionMid-priced apartment sales in Auckland declined sharply between 2007 and 2009. The number of sales in the $150k - $249k price bracket has subsequently increased, and done so to a greater extent than those in other price brackets.
Feedback on the draft Auckland Unitary Plan is currently being assessed, with reports available on the Shape Auckland website.
Auckland Apartment Distribution12 month rolling average
NZ Apartment Distribution12 month rolling average
Source: Real Estate Institute of New Zealand
Demand for apartments
Auckland Unitary Plan
One of the hot topics of the plan is the proposed intensification of housing around some town centres, specifically raising height limits of buildings to allow for more apartment living. In our recent Crockers Property Investment Index (CPII) Survey in partnership with Ipsos, we asked for opinions on this plan.
Perception of reasonable demand for apartmentsA total of one third of respondents felt that there was a high demand for apartments in Auckland (high + very high). Only around 1 in 10 felt that there was low demand. T he majority sat on the fence, indicating a medium level of demand.
Apartments perceived to be the domain of the youngW hen asked what types of people are most interested in renting apartments, the main types identified were young singles or couples, either students or professionals. ‘Young people’ were most mentioned at 36%. ‘Students’ and ‘professionals’ were each mentioned by 29% of respondents. T here is some indication of apartments being desired by those from overseas. Some also felt that there is demand amongst older couples whose children have left home.
Source: CPII Survey July 2013
Divided opinions over Unitary PlanOpinions on the proposal to increase the number of apartments around town centres are mixed, with those in agreement outnumbering those with a negative opinion of the plan: 28% disagree, whilst 46% agree.
Apathy as the predominate responseMost, 92% of respondents had not made a submission on the draft Auckland Unitary Plan. Around one third did not feel that making a submission would make a difference. T his group was more likely to be ambivalent about the proposed changes (indicating that they neither agree nor disagree with the changes). Of the 8% who made a submission, there was a relatively even split between those who agreed with the proposal and those who disagreed.
Agreement with proposal to increase apartments
Submission made?
Source: CPII Survey July 2013
Source: CPII Survey July 2013
Note: Respondents could reply to more than one answer
Crockers Property Group uses market data from a variety of sources which we believe to be accurate and reliable. This enables Crockers to provide analysis and interpretation on the property market. Opinions, statements and analysis are for general information only and should not be relied upon for any specific purpose. Crockers takes no responsibility for decisions you make based on data provided through Crockers Market Research.
T he average price for a two-bedroom rental in Auckland has decreased slightly from the high seen in May to $398 per week, while three-bedroom rental prices have continued to climb to a high of $527 per week in Auckland. T hree-bedroom rental prices have also climbed nationally to $385 per week, holding the Auckland premium steady at 37%.
Auckland Sales & Rental Update Three bedroom rental prices rise
Auckland residential property sales median prices
Auckland residential property sales numbers
$400K
$420K
$440K
$480K
$500K
$520K
$460K
$540K
$560K
$580K
$555K
Janu
ary
Med
ian
pric
e fo
r re
side
ntia
l pro
pert
y so
ld
Dec
embe
r
Nov
embe
r
Oct
ober
Sept
embe
r
Aug
ust
July
June
May
Apr
il
Mar
ch
Febr
uary
Median price 2009Median price 2011
Median price 2010Median price 2012
Median price 2013
1,000
1,500
2,000
2,500
3,000
3,500
Janu
ary
Num
ber
of s
ales
Dec
embe
r
Nov
embe
r
Oct
ober
Sept
embe
r
Aug
ust
July
June
May
Apr
il
Mar
ch
Febr
uary
# of sales 2009# of sales 2011
# of sales 2010# of sales 2012
# of sales 2013
2,485
Source: Real Estate Institute of New Zealand
T he median sales price has softened in June, with the median sales price recorded as $555k compared to $565k in May. T he year on year increase has dropped from 13% to 11%. T he number of sales has fallen, following the trend from 2012, but to a greater extent, with the year on year increase dropping from 10% to 2%.
The premium paid for a 1-bedroom rental in Auckland has decreased over the past ten years as the average rental prices in other metro areas have increased at a greater rate.
Average Rental Price - 1 Bedroom12 month rolling average
Average Rental Price - 2 Bedroom12 month rolling average
NZ Metros: Rental Review
In contrast, 2-bedroom rental prices have increased at a greater rate than those for 1-bedroom rentals. Wellington rents tend to sit at or near the NZ average, whilst those in the South Island are well below.
Source: Real Estate Institute of New Zealand (rental and sales figures)
Source: Real Estate Institute of New Zealand (rental and sales figures)
Sharp turn for investment expectations
Crockers Property Investment Index
For the first time this year, the Crockers Property Investment Index has decreased, reflecting a greater number who are planning to reduce the size of their investment and fewer planning to increase it. T he Crockers Property Investment Performance Index has also decreased from 84 index points to 73 index points, with performance expectations worsening for Auckland residential rental properties.
Sour
ce :
CPII
Surv
ey J
uly
2013
100%
60%
Ind
ex P
oin
ts
80%
40%
20%
44
6165
58
48
56 5667
60
87 8185
91 8874
8781 81 84
57
73
68
77
0%
May 13 Jun 13 Jul 13Jul 12 Aug 12 Sept 12 Oct 12 Nov 12 Dec 12 Jan 13 Feb 13 Mar 13 Apr 13
Residential property gains appealAmongst those planning to invest in rental properties, intention to invest in commercial properties has seen a sharp decline this month to a twelve month low of 9%. Intention to invest in apartments outside of the CBD has held steady, whilst the appeal of those within the CBD has decreased. Non apartment residential property has increased in appeal amongst those looking to invest from just over half (52%) to two thirds (66%).
Planned Rental Property Investment Locations - Next 12 Months