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Auckland’s not-so-great housing correction
It’s supposed to be a buyers’ market when it comes to property sales, but buyers are just as unhappy as sellers right now, and investors are taking losses
Auckland’s not-so-great housing correction
Kerry Buttler and Reece McVinnie followed all the rules when they invested in two Auckland micro apartments in 2018.
They went to property investor talks, engaged an expert agent and carefully weighed up the costs versus income.
“We were a little bit late to the game really,” says McVinnie. “Really it was because we discovered that we were being a bit lazy with our money. Very good savers and so on, but not actually good investors.”
When they recently sold the property after seven months on the market they lost more than seven percent of the price they paid.
They sold into a market at a time where the average asking price had fallen below $1 million for the first time in six years.
Would they do it all again?
“Even knowing what we know, yes,” says McVinnie. “It’s just that we got caught. You know, a massive market correction, and it doesn’t really look like it’s going to change.”
Supplied / Pietra Brettkelly
The Detail talked to buyers and sellers in Auckland’s depressed market, and compared it with property trends in the South Island.
“So North Island and the South Island are very much going their separate ways,” says Owen Vaughan, editor of NZME’s property publication, OneRoof.
“South Island is ticking along like a normal housing market. Like Christchurch, it’s got a vibe to it, but its houses are kind of selling well, but the prices aren’t astronomical.”
Vaughan says a lot of people blame the flood of cheap, badly built townhouses for Auckland’s property slump.
“Cotality (property experts) just recently did research into townhouses. Now, there’s a widely held belief that all the stock on the market that isn’t selling are crappy townhouses; or townhouses are to blame for Auckland’s malaise.
“What they found was that while house prices for townhouses, new build stock, have come down, they haven’t come down any sharper than normal housing stock. So to blame Auckland’s woes on the proliferation of townhouses that nobody wants isn’t really the case. It’s just there isn’t that huge buyer pool.”
Engineer Nathan Brown is steering clear of townhouses in his search for his first home in central Auckland. He tells The Detail he’s confident he’ll find his dream home within his budget of $1.25 million.
“I’ve got AI to just kind of keep an eye out on all the websites which go up, and I’ve told it what I want, and what locations, and what kind of price range. And it will tell me every morning what’s popped up.”
The 28-year-old says he’s been saving nearly all his life for his first home, still lives with his parents and has worked lots of overnight and weekend shifts to save enough money.
“I feel like it’s just part of it is a good goal to work towards. Keep me focused at work, keep my eyes on the prize, but also it just kind of feels like a sense of security, like something, once you’ve got your name on it, it’s yours.”
Cramped townhouses are also off Briana Juretich-Greig’s search list. She and her partner Tom have about $850,000 to buy their first home in Auckland but it might not be her quintessential Kiwi dream home.
“The reality is maybe still two bedrooms or three bedrooms, maybe a smaller little section, not the huge backyard. We’ve been to a few open homes where you can’t have it all.”
Despite the lower prices Juretich-Greig says they’re in no hurry and she’s learnt a lot during the house hunt.
“For example, we went into a home in New Lynn that I really liked, had good bones, thought this could be good, you know, do a bit of a facelift. So we brought a building inspector to come and have a look.
“He had his moisture meter out on the walls and said, there’s just moisture in all of these walls … he’s like, do not buy this house.”
The Detail also meets Richard, whose Auckland family home is on the market for a second time in a few months, but who is unfazed by the ongoing slump in prices.
“Yeah, I think the market at the moment has sort of changed quite a bit, and spring’s good, and all the flowers are looking good. So just want our jasmine to come out now, and I think that’ll make everything look really shiny.”
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The chief executive of the Parliamentary Service is confident there will be enough room to accommodate the increased number of MPs and their staff coming into Parliament.
On current numbers, up to 131 MPs could be sitting in the Chamber following the election, brought on by a record overhang result.
Clerk of the House of Representatives Dr David Wilson told the Spinoff that currently the debating chamber had enough chairs to seat 124 MPs – including the Speaker of the House – and work was being done to accommodate more by altering the seating arrangement.
In a statement, Parliamentary Service chief executive Rafael Gonzalez-Montero said planning for a larger Parliament had been going for “some time”.
“Now that the election results have confirmed an increase to the number of members we are looking at several options.
“We are confident we will be able to accommodate all members within the Chamber.”
VNP / Phil Smith
Gonzalez-Montero said office accommodation for members and their staff would be “stretched” for a short time, but the new Members’ Building was only a few months away from “practical completion”.
That building – located behind Parliament – was due to be ready to occupy in April next year and had capacity to accommodate around 30 backbench MPs.
“All members should be in fit-for-purpose accommodation from that point,” Gonzalez-Montero said.
Following the 2023 election, 123 MPs sat in the Chamber – a record number at the time. That decreased to 122 following the resignation of National MP Judith Collins.
Collins held the seat of Papakura and stepped down in May and Parliament voted against holding a by-election because it was too close to the election.
The election result also meant high-ranking National Party MPs like Chris Bishop, Paul Goldsmith, Nicola Willis and Gerry Brownlee – Speaker of the House and an MP for 30 years – would likely not make it back into Parliament.
Only resigning or retiring MPs were permitted to give a valedictory speech meaning none of them would get the chance to give a valedictory statement.
Asked if their would be special allowances for valedictories, Wilson said in a statement that normally only MPs were allowed to speak in the House but the House could suspend its own rules or temporarily alter them.
“It could do so to allow former members to address the House.”
Wilson said no such arrangements could be made until the next Parliament opened and members sworn in.
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