Property prices outgrow average salary in New Zealand; COVID pandemic cited as a reason

As per the current Trade Me Property Price Index released on Friday, the average price at which a house is sold in New Zealand has touched an all-time high of 846,900 New Zealand dollars (NZD) last month, which is a 21% increase from last year. 

Amidst the COVID-19 Level 4 lockdown in New Zealand, Gavin Lloyd, Sales Director of Trade Me Property which is New Zealand's leading real estate website, declared that property prices surged in the month of August, highlighting the highest recorded yearly growth, with prices going up by 143,950 New Zealand dollars. 

As per the Xinhua report, Lloyd explained the recent Trade Me Jobs statistics states that there is a rise of 2.2 times than New Zealand's average salary, which was 64,939 New Zealand dollars in the second quarter of April-June in this year. He further added that COVID-19 limitations had a substantial influence on market price and supply in August. 

Yet another consequence was that one cannot purchase or sell a property at places within Level 4 regulations. As a result, when a comparison was done for the month of August in 2020, the number of houses advertised for sale onsite fell by 31% this year. He even states that the demand to buy a house has fallen by 24%.  

More about the Property prices rise 

According to Lloyd, every area in the country has experienced record 'average selling prices'. He went on to say that the biggest increases that happened were in the lower North Island areas of Manawatu or Whanganui, which is estimated with a rise of about 30%, to 589,350 NZD. Wellington has increased by 26% to 867,050 NZD, whereas Hawke's Bay has hiked by 23% to 737,050 NZD. 

Lloyd even anticipated that the market will quickly rebound in the upcoming financial quatres. He also claimed that the prices of the housing market in New Zealand have been soaring since the nation emerged from lockdown in 2020. 

As per Xinhua, though New Zealand's housing prices have risen to new all-time highs in recent months, the low interest rates have also been fueling the demand for houses and loans. Since home demand remained strong, supplies and availability fell short. Stock levels were at an all-time minimum in several areas. 

COVID cases in New Zealand

In Addition, New Zealand has registered 11 fresh coronavirus infections that have been reported by health officials. On Friday, the number of those infected with the highly contagious Delta strain in New Zealand approached 879. Until now, 27 fatalities have been registered in New Zealand. 

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