Monthly Property Market & Economic Update

Monthly Property Market & Economic Update

Monthly Property Market & Economic Update

Monthly Property Market & Economic Update New Zealand February 2018

Monthly Property Market & Economic Update

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 2 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. About CoreLogic 4 CoreLogic Data and Analytics . 4 Legal Disclaimer . 4 Macro Economic and Demographic Indicators 6 New Zealand Asset Classes . 7 New Zealand Population . 8 Migration . 9 Regional Building Consents . 10 Population Growth Compared to Building Consents . 10 Consumer Confidence . 11 Employment . 12 Interest Rates . 13 Housing Overview 14 Nationwide Values . 15 Sales Volumes . 16 Rent . 17 Market Activity . 18 Valuations Completed . 19 Listings . 20 Buyer Classification . 22 House Price Index . 23 Main Cities Housing Market Indicators 26 Auckland Market Activity . 28 Auckland Values . 29 Auckland Suburb Value Change . 30 Current Auckland Suburb Values . 32 Hamilton Market Activity . 34 Hamilton Values . 35 Tauranga Market Activity . 36 Tauranga Values . 37 Wellington Market Activity . 38 Wellington Values . 39 Christchurch Market Activity . 40 Christchurch Values . 41 Dunedin Market Activity . 42 Dunedin Values . 43 Contents

Monthly Property Market & Economic Update

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 3 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. About CoreLogic CoreLogic is a leading property information, analytics and services provider in the United States, Australia and New Zealand. CoreLogic helps clients identify and manage growth opportunities, improve performance and mitigate risk, by providing clients with innovative, technology-based services and access to rich data and analytics. Whilst all reasonable effort is made to ensure the information in this publication is current, CoreLogic does not warrant the accuracy, currency or completeness of the data and commentary contained in this publication and to the full extent not prohibited by law excludes all loss or damage arising in connection with the data and commentary contained in this publication. Contact Call us 0800 355 355 Wellington office Level 2, 275 Cuba Street PO Box 4072 Wellington 6140 Email: reports@corelogic.co.nz Auckland office Level 5 41 Shortland Street Auckland 1010 www.corelogic.co.nz

Monthly Property Market & Economic Update

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 4 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. CoreLogic Data and Analytics CoreLogic Buyer Classification A unique and flagship product to CoreLogic, Buyer Classification determines the type of buyer for every purchase of property based on their current and previous ownership of NZ property. Created at a record level, this can be matched to other datasets or summarised at any geographic area.

Our buyer classification is used by financial institutions and Government agencies at both record and summary level and overlaid with their own data to assist strategic, policy, compliance, risk management and marketing decisions. CoreLogic value measures CoreLogic has a suite of products to measure property prices. This ranges from simple market measurements such as median or average sales prices through to stratified medians, various house price indices, and valuing groups of properties using Automated Valuation Models such as E-valuer. The house price indices are available both quarterly for completeness and monthly for reactivity. The Quarterly CoreLogic House Price Index has been specifically designed to track the value of a portfolio of properties over time and is relied upon by New Zealand regulators and industry as the most accurate measurement of housing market performance. These value measures are available for long time series and for either standard or custom geographic areas and property types. Suburb scorecard Detailed housing market indicators at suburb level, with data either in time series or current snapshot, and segmented across houses, flats and apartments. The Suburb Scorecard data includes key housing market metrics such as median prices, median values, transaction volumes, rental statistics and market metrics such as median selling time.

To view the latest report online and subscribe to receive it in your inbox on a monthly basis, visit; www.corelogic.co.nz/new-zealand-monthly- property-market-update If you would like to know more or obtain tailored data, analytics and insights for your business, please email us at reports@corelogic.co.nz. Legal Disclaimer Copyright This publication reproduces materials and content owned or licenced by RP Data Pty Ltd trading as CoreLogic Asia Pacific (CoreLogic) and may include data, statistics, estimates, indices, photographs, maps, tools, calculators (including their outputs), commentary, reports and other information (CoreLogic Data).

© Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Data & Research publications Whilst all reasonable effort is made to ensure the information in this publication is current, CoreLogic does not warrant the accuracy, currency or completeness of the Data and commentary contained in this publication and to the full extent not prohibited by law excludes all loss or damage arising in connection with the Data and commentary contained in this publication. You acknowledge and agree that CoreLogic does not provide any investment, legal, financial or taxation advice as to the suitability of any property and this publication should not be relied upon in lieu of appropriate professional advice.

Published date: February 2018

Monthly Property Market & Economic Update

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 5 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved.

Monthly Property Market & Economic Update

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 6 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Macro Economic and Demographic Indicators

Monthly Property Market & Economic Update

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 7 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. New Zealand Asset Classes The value of residential property continues to grow beyond one trillion dollars, outperforming the value of other asset classes. Residential mortgages secured against 23% of this value. Over the last month stocks worldwide experienced somewhat of a market correction with the NZX dropping 3.6% from its early-January high but they have stabilised in mid-February. Residential Real Estate $1.07 trillion ($247 billion in home loans) Commercial/Industrial Real Estate $201 billion NZ Listed Stocks $125 billion NZ Super and KiwiSaver $79 billion *Source: CoreLogic NZ, Reserve Bank of NZ, NZX, NZ Superfund, Financial Markets Authority

Monthly Property Market & Economic Update

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 8 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. New Zealand Population Population growth slowed further in Q4 2017, with the moving average continuing to trend down. Almost three-quarters of population growth is due to net migration, which was 70,000 for the year to the end of December 2017. This represents a further fall from the peak of 72,200 to the end of June 2017.

After hitting a 20 year low, natural population growth rebounded in Q4 2017, but the overall trend is flat. Quarterly Change in National Population Annual Change in Population Population Change Composition Source: Statistics New Zealand

Monthly Property Market & Economic Update

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 9 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Migration The trend of net migration effectively plateaued for the last three months of 2017 as both arrivals and departures held firm. Immigration continues to be a hot topic for the Government and the declining trend in net migration is likely to continue. This may not be as dramatic as previously expected, due to the need of skilled labour in an already tight market.

After a few months of net loss to Australia, the stats veered back into the positives in the final months of the year. The expected strength in the Australian economy is yet to have a significant impact on Kiwi migrants yet, and while proposed changes to remove the subsidised tertiary fees for New Zealanders have now been scrapped, there are still some concerns about the visa status of New Zealanders in Australia restricting them from access to certain Government schemes. In 2017, Dunedin saw a 23.7% increase in net migration (from 2016): the largest increase of all our main centres. Net migration to Christchurch continues to slowly decrease, after peaking in the year to the end of March 2016.

Long Term Migration Monthly Net Migration Between New Zealand and Australia Net Gain Last Year % Change TOTAL ALL AREAS 70,016 -0.8% Auckland Region 36,152 6.6% Hamilton City 1,875 12.3% Tauranga City 1,052 0.5% Wellington 3,593 10.9% Christchurch City 5,403 -4.0% Dunedin City 1,024 23.7% Main Urban Area (Other) 5,239 -5.9% Rural Centres 4,798 8.6% Not applicable/Not stated 10,880 -23.8% Source: Statistics New Zealand

Monthly Property Market & Economic Update

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 10 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Regional Building Consents Building consents issued in Auckland continues a strong upwards trend but there are consistent reports of the construction industry being very close to capacity. A recent Government commissioned ‘Stocktake’ report detailed three key barriers to housing supply: planning, infrastructure and the development sector. This foreshadows the Government’s challenge in implementing KiwiBuild: the commitment to delivering 100,000 quality affordable homes in the next ten years, half of which will be in Auckland. Elsewhere in NZ consents are now trending sideways as similar constraints affect other centres as well. With population growth slowing and building consents continuing to increase, the gap between the two is reducing. The gap is calculated by assuming 80% of dwellings consented translate into an actual increase in the number of dwellings (which may be generous given our results of consent to stock change analysis), and that each of those dwellings will house the current average number of people (2.7 people per dwelling).

For example, over the year to December 2017 there were 31,127 dwellings consented (able to house 67,234 people), and an increase in population of 97,000, leaving a difference of almost 30,000 too many people for dwellings. Population Growth Compared to Building Consents New Dwelling Consents Trend Quarterly Population Change and Building Consents Nationwide Source: Statistics New Zealand

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 11 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Consumer confidence lifted in January with people remaining happy with their current financial situation. Consumer perception of the economic outlook also lifted, perhaps due to a ‘solid’ start for the Labour-NZ First Government combining with a relatively stable housing market and a strong labour market. The gap in confidence between Australia and NZ was significantly reduced in December with the economic outlook in Australia improving.

Consumer Confidence Source: ANZ NZ, Roy Morgan ANZ-Roy Morgan Confidence Consumer Trans-Tasman Consumer Confidence Index Source: Westpac NZ, McDermott Miller

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 12 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. The rate of part-time employment lifted however the rate of growth in full-time employment eased off for the fourth quarter in a row (albeit only marginally last quarter). The total number of people actually employed has continued to rise. The labour force participation rate eased slightly to 71.0% in Q4 2017 after peaking in Q3 2017 at 71.1% and the unemployment rate dropped further to 4.5% - the lowest since 2008.

For an employment lead significant correction in the housing market to occur, there would have to be a turnaround in employment with people unable to pay mortgages or rent. Employment Annual Change in Employment, Full Time and Part Time Labour Force Participation Rate Unemployment Rate Source: Statistics New Zealand

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 13 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Retail banks are competing strongly for mortgages, with interest rates again taking a noticeable dip in January. The Official Cash Rate (OCR) remained on hold in February and is projected to remain below 2.00% until the end of 2019, which is good news for new borrowers and those coming off fixed rates. The new loan-to-value ratio (LVR) restrictions are now in place. They are only a minor change from previous restrictions with the deposit requirement for investors dropping from 40% to 35% and the share of high LVR lending (above 80% LVR) to owner occupiers increasing from 10% to 15%.

The expected impact on the market is minimal, although it will contribute to a small lift in demand from those who were previously unable to satisfy the LVR requirements. Interest Rates Mortgage Interest Rates - % Average Two Year Fixed Rates - % Projected Official Cash Rate - % Source: Reserve Bank of New Zealand

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 14 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Housing Overview

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 15 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Nationwide Values Nationwide value growth moderated over the summer holiday after a relatively significant lift in November. Three month value growth hit 3.8% at the end of January. This was the fastest rate for over a year, perhaps due to post-election jitters calming and buyers returning to the market - taking advantage of still-low interest rates.

Average Value of Housing Stock - New Zealand Annual and Quarterly Change in Value

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 16 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Sales Volumes Sales volumes in December were flat year- on-year, but January volumes were more subdued (6% down year-on-year). Once again sales volumes were very weak in Auckland. High prices and a re- balancing of demand/supply have reduced the fear of missing out, and as a result the ‘days to sell’ measure has begun to lengthen.

Christchurch experienced a late-spring and summer resurgence in sales volumes with November, December and January all up on the (admittedly weak) prior year. Nationwide Sales Volumes Regional Sales Volumes Year-on-Year Nationwide Annual Change in Sales Volumes

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 17 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Rent Annual rental growth stabilised at 4.9% in December and January, illustrating a similar trend to value growth after both bottomed out in October 2017. Gross rental yield continues to hover along just over 3.0% (as it has done for 18 months+).

Christchurch rent continues to drop, although the rate of -2.8% is not as great as the drop witnessed through most of the second half of 2017. Meanwhile the growth in median rent in Dunedin is now trending downwards after peaking at greater than 10% growth in the middle of 2017. Tauranga’s annual rent increase of 12.1% is slightly misleading because it’s being compared to an anomaly of a month last January. Actual annual change in Tauranga is realistically closer to 7%, which is still rather high – similar to Wellington (7.6%), where we’ve seen and heard plenty about the rental squeeze in the nation’s capital. Median Weekly Rent Annual Change in Rent Gross Yield Auckland $511 4.7% 2.1% Hamilton $365 7.4% 3.5% Tauranga $436 12.1% 3.2% Wellington $466 7.6% 3.2% Christchurch $345 -2.8% 3.6% Dunedin $340 -5.6% 4.5% Nationwide Annual Change in Value and Rent Gross Rental Yield - Nationwide

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 18 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Market Activity We’re still waiting for the market to properly swing back into action, after the prevalence of public holidays in January and early February impacted both demand and subsequent activity. Nonetheless, relative to the same time last year all major centres are experiencing reduced activity, with Auckland the farthest back.

Market Activity Index Latest 3 Weeks Year-on-Year Percentage change Auckland -29% Hamilton City -6% Tauranga City -5% Wellington Region -19% Christchurch City -19% Dunedin City -11% This market activity is based on the number of automated valuations run by bank staff using our systems each week. This number of valuations correlates very closely to the number of sales that will subsequently occur so this is an extremely timely measure of buyer demand, more than any measure of sales. We can also track across any geographic area.

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 19 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Market Activity Year-on-Year This map shows activity in the latest three weeks compared to the same three weeks last year. New Plymouth has picked up where it finished last year with a sustained increase in market activity, 24% up on the same time last year. Elsewhere there are only a handful of smaller districts across the country experiencing a lift in activity. *Size of bubble represents the level of activity for the period 29 January – 18 February 2018 Valuations completed

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 20 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Listings Similar to the demand measure of market activity, the supply measure of new listings takes a few weeks to get back to ‘normal’ levels as holiday makers drift back to work.

The one month change measure is effectively meaningless because it’s comparing to Christmas-New Year period (when listings are scarce). The one year change however can be informative, with Wellington listings relatively weak and not doing much to alleviate already constrained supply. New Listings Average last 3 weeks 1 month change 1 year change New Zealand 2,295 254% -2% Auckland 732 334% -6% Waikato 243 169% 4% Bay of Plenty 156 186% -11% Wellington 218 330% -12% Canterbury 361 378% 2% Otago 101 256% 16% New Listings

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 21 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Total Listings Latest week 1 month change 1 year change New Zealand 29,147 4% 9% Auckland 9,125 5% 23% Waikato 3,063 4% 15% Bay Of Plenty 2,092 3% 14% Wellington 1,571 18% 2% Canterbury 4,723 7% 8% Otago 1,097 3% 9% Total Listings Total listings have begun to trend upwards again in Auckland, with new listings starting to lift and ‘days to sell’ lengthening.

The same is true around the rest of the country but at a reduced rate. Wellington continues to experience a significant shortage, only 2% up on the prior year (which was already a low point for that time of the year).

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 22 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Buyer Classification Buyer Classification - New Zealand First home buyers finished 2017 strongly, accounting for 22.2% of sales in the final quarter of the year but haven’t started off 2018 quite so well, with 21.7% of sales in January.

Movers have bounced back from their Q4 2017 slump, while multiple property owners remained consistent with 37.5% of sales. We have previously noted the reducing share of mortgaged multiple property owners among this group but they actually had a stronger month in January: accounting for almost two- thirds (66%) of multiple property owners purchases (up from 62%), perhaps benefitting from lower interest rates enabling larger loans.

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 23 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. House Price Index Values increased across most of the country in January, with 3.8% growth witnessed nationwide in the three months to the end of January. Auckland values continued a slight resurgence after spending most of 2017 in gradual decline. A similar trend is evident in Tauranga, however values in Hamilton have remained flat for almost six months.

Wellington has seen consistent value growth over the same period after they stalled briefly in winter last year. The growth in values in Dunedin has been more modest but consistent, with 9.3% growth over the last 12 months. January 2018 Current Value 3 months 12 months Since 2007 peak New Zealand $671,531 3.8% 6.4% 62% Auckland $1,054,974 1.6% 0.7% 93% Hamilton $544,935 0.3% 2.6% 51% Tauranga $698,875 1.7% 3.9% 45% Wellington $634,811 4.0% 9.0% 39% Christchurch $494,459 0.8% -0.6% 30% Dunedin $392,512 2.6% 9.3% 37% Average Dwelling Value Source: CoreLogic NZ QV Monthly House Price Index

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 24 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. House Price Index Annual Value Change The greatest growth in values over the last year has been in the districts of Hawke’s Bay, Horowhenua and Masterton. Much of Canterbury has seen little growth over the last 12 months, with Timaru and MacKenzie the exceptions. Further south, the Southland District (main towns Winton, Te Anau and Riverton) saw the greatest growth in the year to the end of January 2018.

*Size of bubble represents the number of properties in the Territorial Authority

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 25 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Three Month Value Change Three month value change by each of the Council areas is patchier and shows a few areas in the top half of the North Island where values have decreased (blue dots). These include Thames Coromandel, Hauraki and Western BOP.

The greatest growth witnessed over this period in the North Island is in Central Hawke’s Bay at 8.0%. Three month growth also remains very high in the MacKenzie District, however it’s always best to treat these smaller areas (smaller dots) with caution due to fewer sales occurring in these areas. *Size of bubble represents the number of properties in the Territorial Authority

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 26 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Main Cities Housing Market Indicators

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 27 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved.

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 28 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Auckland Market Activity Demand in Auckland has been very weak so far this year, in part due to the number of public holidays but this is not the sole reason. The weakness in demand may be a sign of further fatigue in the market. The latest week (up to 18 February) did see a lift but it’s too early to know if this will be sustained.

Multiple property owners appear to have found their new level in Auckland, consistently accounting for around 40% of sales. We must note that each quarter between 25% and 33% of these are making their purchase without a mortgage, unaffected by LVRs or serviceability criteria (and subsequently excluded from RBNZ reporting). First home buyers also remain consistently active at around 23% of the market - we’ve previously noted this groups’ willingness to sacrifice location/property type to enter the property market and this remains true. Buyer Demand - Auckland Buyer Classification - Auckland

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 29 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Values in Auckland are now up 1.6% over the last three months, the fastest rate since December 2016, but with a back drop of continually reducing volumes, this growth is unlikely to be sustained. Papakura continues to experience a strong recovery in values (up 5.1%) since August 2017 after seeing a 3.9% drop after peaking in April 2017. The rest of the city appears to making a slightly more restrained recovery after values plateaued or dropped throughout 2017, with Waitakere the only area to still be behind values from a year ago.

Auckland Values Average Value of Housing Stock - Auckland January 2018 Current Value 3 months 12 months Since 2007 peak Rodney $947,856 1.5% 1.5% 62% North Shore $1,228,920 2.3% 1.2% 90% Waitakere $822,871 0.5% -1.6% 94% Auckland City $1,245,682 1.8% 1.7% 100% Manukau $904,158 1.2% 0.3% 98% Papakura $700,283 2.3% 2.4% 95% Franklin $673,514 1.2% 2.0% 70% Annual and Quarterly Value Change - Auckland

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 30 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Auckland Suburb Value Change Annual Value Change

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 31 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. The 12 month map of value change in Auckland details variance across the city. Parts of Central Auckland and in the Eastern Suburbs are seeing up to 10% growth, while out West and South of the city there are a greater number of suburbs where values have decreased in the last year.

Parts of the North Shore are now showing a bit more sustained growth than previously witnessed. *Size of bubble represents the number of properties in the suburb. Based on CoreLogic Median E-valuer

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 32 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Slight drops in value have not changed a picture of widespread unaffordability in Auckland. There are currently still 106 suburbs where the average value of the housing stock is over one million dollars. 20 km 10 km Current Auckland Suburb Values Median Value of Housing Stock *Based on CoreLogic Median E-valuer

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 33 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved.

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 34 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Hamilton Market Activity Buyer demand in Hamilton started strong but hasn’t been sustained and while other main centres saw a significant lift in the week ending 18 February, Hamilton did not.

Multiple Property Owner activity, including those from Auckland, bottomed out in Hamilton in the middle of last year but they are working their way back, with 43% of sales going to multiple property owners in January. Over three quarters of these secured finance for the purchase. This is interesting considering the tighter Loan to Value Ratio limits for investors, and while these have now been slightly loosened by the Reserve Bank, it’s too soon for the change to have had any real effect on sales. Meanwhile first home buyers had a quieter month in January Buyer Demand - Hamilton Buyer Classification - Hamilton

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 35 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Hamilton values have flattened out since August 2017 after gradually growing for most of 2017. Due to the dip in values a year ago, values are only 2.6% up over the last year though. Hamilton South West has continued to grow recently, however Central & North West has experienced 4 months of falling values.

Out East both the Northern and Southern areas have seemingly plateaued with less than 0.5% three month growth in each. Average Value of Housing Stock - Hamilton Annual and Quarterly Value Change - Hamilton January 2018 Current Value 3 months 12 months Since 2007 peak Hamilton Central & North West $494,164 -0.9% 1% 38% Hamilton North East $692,145 0.5% 2% 54% Hamilton South East $494,488 0.3% 3% 41% Hamilton South West $492,551 1.8% 6% 44% Hamilton Values

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 36 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Tauranga Market Activity A strong start to the year for market activity in Tauranga has since been followed up with the strongest single week of activity since March 2017, for the week ending 18 February, suggesting sales for February could be relatively strong. Multiple Property owners from Auckland remain a weakening presence in the Tauranga market, however other multiple property owners are holding firm, including those requiring mortgages. Buyer Demand - Tauranga Buyer Classification - Tauranga

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 37 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Values have once again started to grow in Tauranga (1.7% over the last three months), although the annual rate of 3.9% remains near the low point from the last four years. January saw the average value reach $698,875, the highest on record. Average Value of Housing Stock - Tauranga Annual and Quarterly Value Change - Tauranga Tauranga Values

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 38 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Wellington Market Activity Market activity in Wellington is following the typical seasonal pattern - starting slowly but finally kicking into action from late January. The upward trend witnessed since early spring appears to be continuing.

First home buyers continue to go from strength to strength in the capital, accounting for 34% of sales in January 2018. In Lower Hutt they were responsible for 42% of sales. Access to KiwiSaver funds and grants are assisting these buyers, while low interest rates are helping to keep mortgage repayments manageable. Meanwhile movers and to a lesser degree multiple property owners have kept their activity in check. Buyer Demand - Wellington Buyer Classification - Wellington

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 39 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Values in Wellington have continued an upward trajectory that began in September last year, increasing 4.0% over the last three months. The annual rate of growth however remains below 10% as the muted period over winter holds it back. Upper Hutt’s recent exceptional growth has hit a speed bump, with only 1.1% growth over the last three months while Porirua (4.0%) and Wellington (3.5%) show no signs of slowing down. Wellington Values Average Value of Housing Stock – Wellington Annual and Quarterly Change in Value - Wellington January 2018 Current Value 3 months 12 months Since 2007 peak Porirua $548,889 4.0% 13% 44% Upper Hutt $470,511 1.1% 9% 34% Lower Hutt $523,344 0.6% 8% 33% Wellington City $764,560 3.5% 9% 44%

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 40 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Christchurch Market Activity Market activity in Christchurch has remained muted following a similar end to 2017, although the latest week of activity (ending 18 February) shows signs of a lift. Not much changed in terms of the types of buyers active between Q4 2017 and January 2018, with movers remaining less active participants and first home buyers remaining near their all-time share levels. While there appeared to be a lift in multiple property owner activity late last year in the Garden City, this is almost wholly attributable to those buyers not requiring a mortgage. They’re unaffected by lending criteria and interest rates and have maintained their activity while all other buyers have dropped away. Buyer Demand - Christchurch Buyer Classification - Christchurch

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 41 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Values remain very subdued in Christchurch, as growth of only 0.8% over the last three months means values are still 0.6% below the same time last year. This is evident across the City; however values in the Hills have finally begun to make some ground back after the average value dropped to below $650k in October 2017.

Over the longer term, Christchurch Southwest has seen the greatest growth since the previous peak at the end of 2007 (39%). Christchurch Values Average Value of Housing Stock - Christchurch Annual and Quarterly Value Change - Christchurch January 2018 Current Value 3 months 12 months Since 2007 peak Banks Peninsula $510,268 -1.0% -1% 6% Christchurch Central & North $584,136 0.9% -1% 32% Christchurch East $372,005 0.6% 0% 20% Christchurch Hills $667,870 2.9% 0% 21% Christchurch Southwest $471,587 0.4% -1% 39%

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 42 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. Dunedin Market Activity 2018 market activity has started off relatively positively for Dunedin, with gradually increasing volumes leading to a strong week ending 18 February 2018. There has been a lift in mortgaged multiple property owners in Dunedin, including those from Auckland. This is a surprise considering the generally accepted lower level of rental stock in the student city and the fact that the policy spotlight is currently on the need to improve rental quality. Many were expecting that areas like Dunedin would become a less attractive investment option. It may be too early to draw this connection yet, but it’s certainly one to keep an eye on.

Buyer Demand - Dunedin Buyer Classification - Dunedin

CoreLogic Monthly Property Market & Economic Update New Zealand February 2018 | 43 © Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. The growth in values in Dunedin has been modest but consistent, with 2.8% growth in the last three months and 9.3% growth over the last 12 months. Values across the Peninsula and Coastal areas have been volatile with values dropping dramatically over winter and quickly regaining those losses in spring and now showing signs of stalling again (although retaining 3.2% growth in the last three months due to prior growth). In Taieri, values have again started to rise, albeit at a slower rate than other parts of the City.

Dunedin Values Average value of stock – Dunedin Annual and quarterly change in value - Dunedin January 2018 Current Value 3 months 12 months Since 2007 peak Dunedin Central & North $410,278 3.2% 10% 36% Dunedin South $373,189 2.0% 9% 31% Peninsula and Coastal $360,397 3.5% 13% 33% Taieri $402,502 1.8% 7% 37%

© Copyright 2018. CoreLogic and its licensors are the sole and exclusive owners of all rights, title and interest (including intellectual property rights) the CoreLogic Data contained in this publication. All rights reserved. corelogic.co.nz For more information contact us 0800 355 355