9 Jan 2014

Auckland house prices continue to rise

10:45 am on 9 January 2014

Auckland's biggest real estate agency says the average price of a home in the city has never been higher.

Barfoot and Thompson said the average residential sale price in December last year was a record $700,387 - an increase of 12% on a year earlier.

Housing in Auckland is the least affordable in New Zealand.

Housing in Auckland is the least affordable in New Zealand. Photo: PHOTO NZ

During the month, the agency sold 817 properties, the second highest number for that month in a decade.

The median price for December was $629,000, which was 14% higher than the December 2012 median of $550,000.

The company says the figures are signs of an improving economy and it is predicting a strong first quarter this year because of high demand for homes and pressure on supply.

Barfoot and Thompson managing director Peter Thompson said prices are being driven by tight supply.

"Again, we had one of our lowest months for listings and the amount of stock that we had on the end of December was just over 2900 properties. If we go back two years, we were averaging about 4500 properties on our books."

The higher prices are putting the squeeze on renters, including clients of the Monte Cecilia Housing Trust which tries to help homeless families find long term accommodation.

Trust executive David Zussman said low income families are getting pushed further and further out of the city, and that affects their ability to get jobs.

He said inner city suburbs are becoming less affordable but if the community wants to stop that, it needs to think about how to achieve a mix of owners and renters.