Homes throughout the country have become more affordable over the past 12 months, with most improvements in North Island regions.
The latest AMP Banking Home Affordability Report shows that affordability dropped slightly - by 0.6 per cent - in the September quarter. However, the bank says that continued low interest rates have kept home affordability stable over the past year.
In the last 12 months, Northland has seen the most improvement in the affordability stakes at 36 per cent. Auckland improved 28.9 per cent, but still remains the country's least affordable region.
AMP Banking marketing manager Paul Sweet says the stable trend in home affordability may be threatened by current upward pressures on interest rates.
"AMP Banking is increasingly seeing customers looking to combine floating and fixed rates as a means of protecting themselves against any movement."
The Home Affordability Report is prepared for AMP Banking by Massey University's Real Estate Analysis Unit. It combines data on house prices, mortgage rates and average weekly earnings to come up with a measure of home mortgage affordability in 11 different regions.
| Region | Index, June quarter 1999 | Index, September quarter 1999 | Improvement over past 12 months | | --------------------- | ---------------------------- | --------------------------------- | ----------------------------------- | | Northland | 15.82 | 14.43 | 36.0% | | Auckland | 20.77 | 20.69 | 28.9% | | Waikato/Bay of Plenty | 15.98 | 15.65 | 27.3% | | Hawkes Bay | 13.30 | 12.12 | 29.0% | | Manawatu/Wanganui | 11.04 | 10.99 | 25.6% | | Taranaki | 9.19 | 8.92 | 30.3% | | Wellington | 15.05 | 15.01 | 25.3% | | Nelson | 14.54 | 14.50 | 24.8% | | Canterbury/Westland | 13.94 | 14.52 | 28.3% | | Otago | 8.85 | 10.94 | 20.8% | | Southland | 7.20 | 7.71 | 24.0% | | New Zealand | 15.99 | 16.08 | 28.1% |
Remember, a low index equals better affordability.
Source: the AMP Banking Home Affordability Report, September 1999.
