James Wilson, director of valuation innovation from Valocity shared some of his insights. The Valocity Covid-19 value index gives us some clues about movement in prices, pre covid and post covid.
Pre Covid
Pre Covid we saw a 9.1% nationwide increase in the index in only 3 months. Auckland saw 6.1% and most home buyers felt the surge at the start of the year. Wellington and Hamilton home buyers might have felt even more of a rush with 7%+ increase in most prices.
Post Covid
Post Covid when compared to the previous 3 months, we start to see some interesting trends. Auckland comes through stable – with no growth but no down turn either. Although most auction rooms now might be pointing to increased price pressure.
Central North Island still shows a lot of confidence from buyers, Bay of Plenty, Gisborne and Whanganui came out of the blocks with resilient prices. Underlying drivers might be stronger in those economies, such as employment opportunities or utility of lower price points.
The future
With covid there is almost nothing to compare it to. All crystal ball gazing must be looked at just as that. Similarities with the last big crisis might stop at the volumes being lower(number of houses sold). Mortgage registration data shows first home buyers have been more active. Investors took a cautionary approach at the start but recent trends might reveal that they are creeping back in.
Property is mostly a long term proposition with some lulls in the market lasting years. If you are looking at this over the long term there are still good propositions around.
