All figures compare March 2019 quarter with March 2018 quarter
Residential prices in the Wellington Central market remain on an upward trajectory. Tight market conditions coupled with limited supply have put continued pressure on values.
The Wellington central residential market continues to grow from strength to strength. Figures for the March 2019 quarter saw the median residential value reach $773,000, the highest price on record.
The fundamentals of the Wellington market remain very tight, due to above average net migration, limited new supply and low levels of available inventory. These dynamics are placing further upward pressure on values. This creates a solid foundation for residenital value growth which is continually witnessed in the Wellington residential market.
When breaking residential transactions down into different value bands, a continued trend towards increased sales in the upper value band (sales for over $1m) is evident. The year to March 2019 saw 20% of all transactions take place at the upper end of the market, compared with 15% a year earlier and 11% two years earlier. This trend is being supported by strong demand and limited supply, and is unlikely to change anytime soon, especially as the drivers of Wellington regional economy remain so strong.
The total amount of property available to sell on the market remains at historically low levels in the Wellington residential market. With limited stock, listings brought to the market are being sold quickly, keeping the total amount of inventory at low levels. In the 12 month period to February 2019 the total amount of inventory sitting on the market was 1,026, 55% lower than the long term average of 2,257. The total number of weeks it would take to sell down this inventory sat at just 8 weeks over the same period, significantly lower than the long term average of 17 weeks. The low levels of inventory and fast absorption of stock, partly due to the ‘fear of missing out’ (FOMO), are keeping market conditions tight.
The year to February 2019 saw the total number of new residential building consents in Wellington City, reach their highest level since 2009, with a total of 1,120 consents issued. This clearly illustrates the construction sectors response to the supply and demand imbalance in the market. An ongoing trend towards higher density housing is evident with almost 70% of all consents issued over the year to February 2019 for apartment or townhouse accommodation.
When breaking Wellington Central down by zone, Western Wellington held the highest value properties over the year to March 2019, with a median value of $836,000. High value areas within Western Wellington include suburbs such as Kelburn and Wadestown. Over the year to March 2019, Central Wellington witnessed the highest growth in residenital values, up 12% when compared with the year to March 2018.
Analysing a selection of Wellington suburbs shows that when comparing the year to March 2019 with the same period a year prior, all suburbs have witnessed a increase in residential value. Mt Victoria was the highest growth suburb of the selected suburbs, up 27% (or $215,000) and recording a median value of $1,000,000 over the year to March 2019. The strong growth across all Wellington suburbs, illustrates the strong demand for any property currently being brought to the market.