Homes slightly more affordable

CHLOE WINTER AND FAIRFAX NZ
Last updated 09:24 01/07/2014

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Nelson-Marlborough is the fourth least affordable region in the country in which to buy a home, new research shows.

Massey University's latest affordability report showed houses in the region were 2.2 per cent more affordable in the 12 months ending May 2014.

Southland had the biggest improvement in affordability (up 14.4 per cent), then Taranaki (8.4 per cent), Manawatu-Wanganui (6.2 per cent). Otago had the smallest improvement at just 0.8 per cent.

Affordability is calculated by Massey University for each region, comparing average weekly household earnings against the median house price and mortgage interest rates. Quotable Value's residential property index showed the average value of Marlborough homes was $346,573 in April 2014, an increase of 1.4 per cent over the past 12 months.

Harcourts Marlborough senior sales and marketing consultant Bryan Palmer said housing affordability needed to be based on a trend.

"The overall trend for Marlborough is steady . . . currently Nelson-Marlborough is 55 per cent of take-home pay, so 55 per cent of your money is used to pay the mortgage.

"But if you go back to 2010, for Nelson-Marlborough, it was 69 per cent. In a space of four years - that's a big difference."

The Express reported this month that Marlborough property managers and real estate agents believed homes in the region were very affordable, despite New Zealand houses ranking among the most expensive in the world.

Homes nationally became 7.6 per cent less affordable over the year.

The national take-home pay, based on median house prices, was 67 per cent, Palmer said.

Massey's researchers said the results were "no real surprise" as wage rises were not enough to offset increasing house prices and interest rates.

The researchers noted that the affordability gap between urban and rural regions was widening.

Auckland was the least affordable region but seven regions had a fall in affordability, with the biggest decline in Central Otago-Lakes District (down 12.2 per cent).

Canterbury-Westland houses were 10.6 per cent more expensive and Auckland's were 9.1 per cent. In Wellington and the Waikato, affordability declined by 3.4 per cent and 4.8 per cent, respectively.

Note: This story has been updated and corrected.

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- The Marlborough Express

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