MEDIA RELEASE 1 MARCH 2021
NEW RESEARCH SHOWS WELLINGTON BUYERS HARDEST HIT BY PROPERTY BOOM
New research by OneRoof.co.nz shows Wellington first-home buyers have been hit the hardest by the recent property boom.
Oneroof.co.nz has calculated the extra thousands of dollars first home buyers must now save as a result of rising house prices.
Deposit requirements grew by $28,000 to $153,000 for New Zealand in the last 12 months. But first home buyers in the capital face an even steeper climb, with the amount they need to save growing $43,000 over the same period to $171,000.
The release of the research coincides with the launch of the OneRoof Property Report today and demonstrates the ongoing challenges for first home buyers.
The new head of OneRoof.co.nz, Paul Maher, said: “In a rapidly changing market, driven by low interest rates and fear of missing out, it’s more important than ever to know what is exactly happening. We conducted this research to illustrate the challenges many buyers are facing right now and to inform and support them in the biggest financial decisions they will make.”
OneRoof editor Owen Vaughan said: "The post-lockdown surge has definitely made it harder for first home buyers. While the cost of servicing a mortgage has never been lower, deposit requirements have never been higher.
"The path to home-ownership is particularly steep in Wellington. Median house prices in the city have broken the $1 million barrier – way above what the Government believes is affordable.
"Compare that to the situation in Christchurch, where first home buyers in the city would typically only need a $107,000 deposit - up $27,000 in the last 12 months."
The research shows first home buyers in Invercargill and Queenstown Lakes have been the least impacted by the post-lockdown surge, although for different reasons. The typical deposit requirement in Invercargill grew $15,000 to $64,000, the result of the city’s low median property value of $395,000. Queenstown Lakes’ deposit requirement grew $16,000, the result of the region’s economy bearing brunt of the absence of international tourism and house prices struggling post-lockdown.
OneRoof.co.nz calculated extra money required for a 20% deposit by using the current median property value in each region and comparing it to the median value 12 months ago.
Maher said: “While the rise in prices will frustrate many first home buyers, it does show the benefits of getting onto the property ladder as a long-term investment.”
Other points to note from the OneRoof.co.nz research:
- Auckland buyers face deposit requirements of $200,000-plus - $41,000 more than 12 months ago. The most expensive part of the city for first home buyers, though, is the North Shore, where buyers would need to save $262,000 - $51,000 more than last year.
- There are 434 suburbs across New Zealand with median property values of more than $1 million - a 96% increase in the last 12 months. Twenty-seven suburbs have median values of $2 million or more - 125% up on last year.
- Herne Bay, in Auckland, has become New Zealand’s first suburb with a $3 million median property value, six years after becoming the first suburb to break the $2 million barrier.
Source: OneRoof.co.nz and data partner Valocity
Cliff Joiner, GM Communications,
New Zealand Media and Entertainment.