Migration impact appears limited

Fluctuations in migration have not noticeably affected Auckland’s steady and significant growth in house prices, Crockers says.

Monday, August 11th 2014, 12:00AM

by The Landlord

The real estate firm has released its latest research.

This month, it has looked at net migration compared to median house prices across the main centres.

Migration is a hot topic at the moment because far fewer New Zealanders are leaving for Australia than in recent years, and more are returning.

Permanent arrivals for the June year topped 100,000 for the first time.

The Reserve Bank has warned that if migration is stronger than its predictions, as many economists think it will be, official interest rates may have to rise faster and more sharply than it is currently projecting.

But the Crockers data seems to show that migration isn't a direct driver in Auckland.

The report said in Auckland there were seasonal peaks in migration in February, due to the university year beginning, and September, when departures dropped off while arrival numbers remained high.

Large spikes in migration figures at those times were not matched by similar turbulence in median prices.

Drops in migration in 2010, 2011 and 2012 made little difference to the upward trend and a drop in migration in the first quarter of last year on slightly changed the momentum of prices.

“The significant peaks in net migration in September 2013 and February 2014 are followed by small peaks in median sales prices, possibly indicating that these seasonal peaks on top of underlying increase in migration may be adding to demand in the region and therefore impacting on prices," the report said.

Crockers said median sales prices and migration into Hamilton and Wellington had been stable, with no significant change.

In the South Island, Crockers said there was a more noticeable correlation between prices and migration trends in Christchurch, but that was also linked to the city’s earthquakes. “Given the impact the 2010 and 2011 earthquakes caused on housing demand, net migration into Christchurch is not the only factor to impact house prices.”

The report said Dunedin had experienced stable sales prices and migration over recent years.

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