4 Apr 2016

More Auckland homes - but what about the price?

5:47 am on 4 April 2016

Figures released for the first time raise questions about whether new home building in Auckland is making the city any more affordable.

Part of a housing development in the Tamaki area in Auckland.

Part of a housing development in the Tamaki area in Auckland. Photo: RNZ / Kim Baker Wilson

The median price of new dwellings is $800,000, and fewer than 20 percent of new homes qualify for KiwiSaver first-home-buyer subsidies.

The data, obtained by RNZ News from the Auckland Council, does not include all new dwellings but is considered the most comprehensive picture of the price mix of homes being added to the city.

It covers nearly 3000 sales of new dwellings in Auckland in 2014, and through to early November in 2015.

Auckland is suffering from a housing shortage, and while the rate of price rises has slowed in recent months, the median price of all sales in February was 11 percent higher than a year earlier.

Policies to deal with both the shortage and the house price inflation, have focused on increasing the supply of homes, such as the government's Housing Accord, which fast-tracks planning.

Supply has improved from a low of 3475 consents in 2009, to an annual level of 9500. That's still short of the 13,500 homes estimated as needing to be added each year for three decades.

However the data obtained by RNZ News for the first time throws some light on whether the city is building its way out of unaffordability.

The picture is one of a city selling fewer than 20 percent of new homes below the $550,000 cap that qualifies first-home buyers for KiwiSaver subsidies.

Of new-build sales, 35 percent are in the band between $750,000 and $1.05 million.

The average prices for existing homes sold was just over $760,000, while the average price for new-builds was just over $853,000.

Part of the premium can be explained by the new-builds on average being larger than the existing stock, and built to higher standards.

The data also shows the shift away from new standalone homes in the under $550,000 bracket. Standalone houses in that price range make up only 6.3 percent of the total homes sold.

Units and apartments selling new for less than $550,000 made up 13.5 percent of total sales.

The median price for new apartments is between $450,000-$500,000, while for units and townhouses it is $550,000-$600,000, and standalone homes $800,000-$850,000.

The data excludes some new-builds. Social rental housing such as dwellings built by Housing New Zealand are not included because they are not "sold". Nor are homes which people have built for them on land they own, such as some home-and-land packages.

The data is from new sales notified to the Auckland Council, with work done by analysts Corelogic and Market Economics to categorise the sales, and adjust prices to take into account inflation.

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