PHOTO: Sarah Wood, CEO of realestate.co.nz. SUPPLIED
Despite the fall in property prices last year, the latest data from realestate.co.nz proves that prices inevitably go up in the long run.
· In the ten years to 2023, the average asking price in every New Zealand region has increased, with 12 of 19 regions at least doubling and the remaining six increasing by at least 50%.
· Of the country’s 76 districts, 36 have increased by at least two-fold, while a further six were up by more than 90%.
Nationally, the average asking price was up by 77.5%, increasing from $504,388 in 2014 to $895,289 in 2023.
Sarah Wood, CEO of realestate.co.nz, says the data underscores a resilient real estate market:
“We saw the market go through a correction in 2023 after rapid growth during the previous few years. Despite prices dropping back last year, they are still up substantially in most places when we compare them to the years before COVID-19 ignited the market.
“It’s welcome news for the vast majority of Kiwis whose biggest asset is their home that although we will see peaks and troughs, prices are continuing to trend upward over the long term.”
COVID-19 years bring unprecedented price growth
The standout years for significant price growth were 2019 to 2022, with the national average asking price increasing by almost 40% over this four-year period.
In the decade leading up to and including 2019, only one district doubled, and some even saw prices go backwards – Whakatane (down by 33%), Waitomo (down by 20%), and Grey (down by 11%).
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A new decade in 2020 brought new levels of growth, with prices in almost all districts increasing over ten years and three doubling – Kawerau (up by 132%), Central Hawke’s Bay (up by 108%), and Hamilton City (up by 102%).
But it was 2021 and 2022 that brought the biggest changes to prices, with a substantial number of places doubling in ten years. In 2021, 34 of our 76 districts had doubled in the past ten years; in 2022, more than half had doubled (43 out of 76).
“This unprecedented growth can be attributed to several factors, including low interest rates, population growth, and limited housing supply, which have combined to create a competitive market environment,” explains Sarah.
One of the areas to benefit the most from price hikes over the growth years is Wanaka. In the decade up to 2019, Wanaka was the slowest-growing district in the Central Otago/Lakes region, up 23% from 2010. Prices in the district didn’t double in ten years until 2022, when prices went from $906,387 in 2013 to $1,966,673. This trajectory continued into 2023, which saw Wanaka achieve the largest ten-year growth in the region, hitting an average asking price of $2,012,974.
Kawerau tops charts for five years running
The Bay of Plenty township of Kawerau has seen the most significant growth, increasing by 261.2% during the past decade.
While it remains New Zealand’s lowest-priced district, with an average asking price of $443,093 in 2023, this has almost quadrupled from $122,665 in 2014.
Wood says it’s the fifth consecutive year Kawerau has seen the biggest decade growth.
“In 2019, the first year we analysed this data, Kawerau was the only district that had doubled in 10 years, up by 112% on 2010.”
“Since then, it has achieved the biggest growth in average asking prices every year compared to the ten years prior.”
Tania Humberstone, a spokesperson for Kawerau District Council, says enabling new housing options in the area has been a council priority over the past seven-plus years, spurring demand.
“Our housing strategy is committed to its vision of creating vibrant, sustainable communities that cater to diverse needs.
“Kawerau remains a valuable market, offering an incentive for people to return home to purchase homes, or to embrace more flexible working arrangements and move away from more populated nearby areas such as Tauranga.”
Following Kawerau, the Hauraki Gulf Islands saw the next biggest increase in prices in the ten years to 2023.
Made up of Great Barrier, Kawau, and Rakino, these islands within the Auckland region increased by 171.8% from an average asking price of $713,123 in 2014 to $1,938,342 in 2023.
The Hauraki Gulf Islands were the only Auckland district to double in ten years in the past decade.
At the other end of the scale, the districts to see the smallest ten-year growth are all within the Canterbury region: Selwyn (up by 39.2%), Ashburton (up by 40.5%), and Waimate (up by 40.9%).