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Housing slightly more affordable

Contributor:
Fuseworks Media
Fuseworks Media

Wellington, Sept 30 NZPA - Housing affordability improved slightly in the latest quarter due to a small rise in earnings and small fall in interest rates, a regular Massey University report shows.

In the three months to the end of August, national affordability rose 0.8 percent, as the average weekly wage rose $6.15, median house prices stayed static at $350,000, and the average monthly mortgage interest rate edged down 0.01 percent to 6.59 percent.

"The housing market is currently characterised by very low turnover rates, expectations that mortgage interest rates will not increase very much in the short term and continuing low wage growth," report compiler Professor Bob Hargreaves said.

At the same time, the economy was gradually recovering from recession and the effects of the Canterbury earthquake.

During the year to August, national affordability improved 9.7 percent from the previous year, well down from the 11.1 percent increase in the three months to May.

Among the regions, Northland had the biggest improvement during the latest quarter, lifting 6.4 percent to be at 93.5 percent of the national average. Auckland improved 1.7 percent to 121.1 percent, while Central Otago Lakes remained the least affordable region at 141.2 percent of average after dropping 1.3 percent.

Taranaki showed the best gain during the past year, improving 20.7 percent, while Central Otago Lakes was third best improver over the year at 16.7 percent.

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