Central Otago Lakes is now less affordable to live in than Auckland according to a report.
The report , by Massey University, shows that Central Otago Lakes is 68% less affordable than the rest of New Zealand, while Auckland is sitting at 55%.
This is due to the improvement in affordability in Auckland by 7.5% combined with the decline of 8.2% in Central Otago Lakes.
The median house price is nearly 14 times the median annual wage in central Otago.
“these two regions are the least affordable by a clear margin”, report author associate professor Graham Squires from Massey’s school of Economics and Finance said.
“Central Otago also has the largest decline in affordability over the twelve month period, which is a reflection of tourism industry demand in Queenstown, a shortage of housing supply, speculative investment demand, a focus on high-end lifestyle living in the area, and largely stagnant wage increases”
The median house price in Auckland dropped 6.1%, or $51,944.00 in the December 2016 – February 2017 quarter, falling into second place.
A fall in house prices across seven regions , including Auckland, has improved national affordability in the same period, but the ratio of median house price to median wage remains very high in Auckland and Central Otago Lakes.
Supply and demand of trades people is also another factor which is affecting affordable housing as no one appears to be dropping rates but in fact the opposite due to the current work load on offer.
While demand for housing and tradesman is greater than available tradesman to actually do the work, affordable housing continues to be unobtainable and will do for many years to come as far as we can see.