11 Dec 2015

Akl property problems won't spread... yet - economist

11:59 am on 11 December 2015

The increase in Auckland investors buying Wellington and Hamilton properties won't cause the more southern cities' property markets to overheat in the same way Auckland's has, an economist says.

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Photo: 123rf.com

Wellington real estate agents said Auckland-based buyers are purchasing properties for as much as $300,000 above rateable value. Hamilton agents have also reported a surge in interest from Auckland buyers.

But independent economist Shamubeel Eaqub said any increase in property markets outside of Auckland was not yet a sign of Auckland's issues spilling over.

"Any increases now is not going to be presenting the kinds of risks that Auckland does," Mr Eaqub said.

"But very low interest rates will, of course, attract more investors, more money into the market and unless we're building enough homes, it will become the same kind of problems we're seeing in Auckland - but not for some time yet."

Shamubeel Eaqub

Shamubeel Eaqub Photo: Supplied

The housing shortage still needed urgent attention, Mr Eaqub said. If enough homes weren't built, then Wellington could face the same problems, but not in the immediate future.

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