The latest home affordability report by Massey University found that housing affordability has improved across New Zealand. The report looked at house prices, the cost of borrowing and wages across the nation.
Out of the 13 regions in the country, seven reported improvements in housing affordability.
In the last three months, the report found that housing prices fell in Northland, Wellington and Central Otago Lakes. Although Central Otago Lakes median house prices fell by $35,000, it is still the least affordable region in the country, followed closely by Auckland.
Housing crisis in Central Otago
Central Otago’s district council is determined to end the crisis of housing affordability. Housing Taskforce, a group of 20 individuals with a wide range of expertise, was formed in April and expects that if nothing is done to combat the issue, house prices will continue to rise.
The last initiative to combat rising house prices in the district was introduced three years ago when the Queenstown Lakes District Council entered into an agreement with the Government which allowed special housing areas. Since then there have been seven special housing areas approved, almost 1750 homes built and the median house price has risen from $664,000 to $850,000.
Housing affordability issues in Wellington
In Wellington, housing affordability continues to affect first home buyers. Despite the fall of median house prices in the city in the past three months, houses there continue to climb out of reach of first home buyers. Not only are housing prices in Wellington ten per cent higher than they were a year ago, they are projected to increase a further five per cent in the next year.
Therefore, house prices continue to be the key to determining home affordability as borrowing costs remain low and wages static.
