Home affordability has fallen for the third quarter in a row, reflecting higher interest rates and a "challenging" economic environment.
The AMP Banking Home Affordability index, which combines data on house prices, mortgage rates and average weekly earnings, suffered its sharpest decline since the March 1995 quarter. New Zealand homes fell on average nearly 13 per cent in affordability over the March 2000 quarter, with the Southland region suffering the greatest decline (25.3 per cent).
Taranaki (down 25 per cent) and Wellington (19.4 per cent) were next in line, with every region proving less affordable.
What's happening in the regions (the higher the index figure, the lower the affordability):
| Region | Index: November 1999 | Index: February 2000 | Decline in index over last quarter | Decline in index over last 12 months | | ----------------------- | ------------------------ | ------------------------ | -------------------------------------- | ---------------------------------------- | | Northland | 15.01 | 15.73 | 4.8% | 13.1% | | Auckland | 21.97 | 25.17 | 14.6% | 18.5% | | Waikato/BOP | 17.05 | 18.31 | 7.4% | 17.1% | | Hawkes Bay | 13.62 | 15.47 | 13.6% | 6.5% | | Manawatu/Wanganui | 11.78 | 14.01 | 18.9% | 23.1% | | Taranaki | 9.91 | 12.38 | 25% | 20.6% | | Wellington | 15.68 | 18.73 | 19.4% | 20.9% | | Nelson | 15.49 | 17.69 | 14.2% | 24.8% | | Canterbury/Westland | 14.92 | 16.51 | 10.7% | 9.9% | | Otago | 10.44 | 11.98 | 14.8% | 22.5% | | Southland | 7.73 | 9.69 | 25.3% | 17.0% | | New Zealand | 16.77 | 18.94 | 12.9% | 16.2% |
The above data is from the AMP Banking Home Affordability survey, which is prepared by Massey University's Real Estate Unit. You can find the full report on their website at http://property-group.massey.ac.nz/mureau/mureau.htm or, if you already have Acrobat Reader, just click here.
