New figures showing Auckland’s median house price have reached a record high of $820,000 comes as no surprise to Affordable Auckland spokesman Stephen Berry. “As I stated in the beginning of March, house price inflation had only temporarily subsided while investors took a wait and see approach following the introduction of new regulations in late 2015.”
“Following new rules being introduced in October 2015 requiring non-resident purchasers to obtain an IRD number, 37,000 new numbers have been issued to investors. It is clear a tidal wave of fresh investment is gathering pace to flood the Auckland market.”
Stephen is confident that there will be no relief for first home buyers in 2016 because none of the causes of distortion in market behaviour have been correct by Auckland Council since the beginning of the price bubble. “The Metropolitan Urban limit is still in place and nothing has been done to extend or abolish it. Therefore the artificial land shortage will continue to inflate prices. Until this fundamental flaw in our real estate sector is fixed, prices can only skyrocket.”
“Supply is not the only factor accelerating prices. Slow regulatory processes increasing development costs, the ability of nosy neighbours to interfere in the business of private property owners and ever increasing rates bills all add to the problems faced by young families and those on low incomes. However the most powerful step the Council could take to fix the regulatory distortions in our market would be to abolish the Metropolitan Urban limit opening up the city’s greenfield resources for new construction.”
Stephen Berry was the Affordable Auckland candidate for Mayor in 2013. He recently withdrew from the 2016 race but continues to advocate for solutions to the high cost of living in Auckland.