Wellington house prices rise, some apartments down, in council revaluation

Tuesday, 3 November 2015

The average capital value for a property in Seatoun is now $1,045,000, an increase of 8.2 per cent.

Some of Wellington's cheapest suburbs are seeing the biggest valuation gains, as buyers struggle to get on to the property ladder.

The latest Wellington city revaluation saw a 6.6 per cent increase since 2012, putting the average value of a house in the capital at $597,000.

But while house prices are now back above their 2008 peak, apartment prices appear to be sliding, while areas that were once considered the most affordable are becoming less so.

The biggest rise was in Berhampore, Mt Cook and Newtown, which as a whole saw a 10 per cent increase, to $457,000. The increase saw those suburbs leapfrog ahead of Wellington Central, where prices remained flat over three years.

* Average NZ house price now $500,000**

Harcourts Wellington City managing director Marty Scott said demand in the city was strongest for houses under $600,000, often among first-time buyers looking to buy in fringe areas of the city. In this range, it was not uncommon for buyers to pay $60,000 more they hoped for, owing to a shortage of stock on the market.

'People who want to buy in these 'mid-range' areas will face quite a few disappointments and are likely to be outbid.'

Other corners of the market were struggling, with QV figures showing apartments in Oriental Bay had dropped by 8.8 per cent since 2012.

QV Wellington operations manager David Nagel said the once high-end apartments were now becoming dated, and new developments had given buyers more choice.

Despite the fall in apartment prices, Oriental Bay and Roseneath remained the most expensive part of the capital, with an average price of $1,161,000

Seatoun and Kelburn both joined the million-dollar club, with average prices in the suburb now in excess of $1 million.

The valuation looked at 77,515 properties in the capital, 55,000 of which were homes. The ratings will be used from July 1 next year.

While the increase may be welcomed by homeowners, those seeing the biggest gains face increases in their rates from July 2016, with the valuations forming the basis for council rates.

Wellington City Council financial strategy and treasury manager Martin Read said there would be a 'minimal impact' on rates for homeowners, but was unable to give details.

Mayor Celia Wade Brown said the valuations demonstrated a steady build of new apartments, multi-unit developments and 'greenfield' housing to deal with the region's population increase and changing demographics.

'Property prices in the city remain firmly in reach of individuals, couples and families seeking choice and a range of housing,' she said.

'The capital city is clearly the most affordable of the nation's major centres, with an average house price of around $600,000.'

Deputy Mayor Justin Lester said the city was showing steady and consistent growth. 'This is preferable to a boom-bust scenario and ensures housing is reasonably priced for new homeowners in the city.'

Valuations will be sent out to property owners on November 11.

Homeowners can find out on the ratings value website how the valuations of their properties compares with their neighbours'. An objection period, during which owners can challenge their CVs, closes on December 17.

HOW TO OBJECT:

* Objections must be lodged by December 17 in writing, instructions on reverse of owners' notice.

* Owners can attach supporting info at QV's online objection portal.

* Property is then inspected and a valuer will contact the objector, if necessary. Decision is notified in writing.

KEY DATES:

* Sept 1: effective date of valuation

* Oct 31: implementation

* Nov 4: public notice published

* From Nov 11: owners advised

* May 31, 2016: objections completed

* From July 1: used for rating

REGIONAL COMPARISONS

Wellington saw a bigger increase than most of its neighbouring regions. However, QV Wellington operations manager David Nagel said it wasn't comparing like with like, because some of the valuations were made in different years.

In 2104, similar increases were seen in Masterton (2.2 per cent), South Wairarapa (4.6 per cent), Carterton (6.2 per cent) and Kapiti Coast (2.1 per cent).

However, valuations in 2013 saw decreases because of a struggling market, Nagel said. Lower Hutt decreased by 1.2 per cent, Porirua by 0.7 per cent, and Upper Hutt increased by just 0.1 per cent.

Nationally this year, valuations in Whangarei increased by 5.9 per cent and by 3.7 per cent in Palmerston North.

Last year, valuations increased by 29 per cent in Auckland but decreased by 0.2 per cent in Napier. In 2013, Dunedin values increased by 3.1 per cent.