In September sales volumes were unusually low across New Zealand, but median house prices increased again in 14 regions. Meanwhile, the Auckland market is stable – and looks set to remain so into the near future.
Property snapshot: Quiet start to spring across the country
Published: October 2018
The latest data from the Real Estate Institute of New Zealand (REINZ) put sales volumes and house prices under the spotlight. Here’s a snapshot of what’s happening in this space.
According to Bindi Norwell, September’s unusually low sales volumes (down 3% year-on-year) were a result of the low number of new listings in July. Interestingly, with 5,506 properties sold, September 2018 saw the lowest number for the month since 2011.
"Traditionally, there is a lag of about six weeks between significant movements in listings and sales results," said Norwell. "With July’s listings down by 5.4% year-on-year and an all-time low level of listings in seven regions, it’s little wonder that September’s sales volumes were so low."
In light of August and September’s listing numbers (+0.1% and +11.7% respectively), sales volumes are set to be stronger in October and November.
In terms of sales volumes, 12 out of 16 regions saw a fall, with six regions seeing double-digit decreases year-on-year. These include:
The only four regions that saw an increase in the number of properties sold were:
From a price perspective, the upward trend goes on, with four regions achieving record median prices and one (Hawke’s Bay) equalling its previous record:
At a national level, the median house price increased 5.9% year-on-year to $556,000. But excluding Auckland (whose market remains flat), the national median house price rose 8.5% annually to $466,750 – an all-time high.
"With our population growth and demand for properties continuing to exceed the supply of housing stock, prices are likely to continue increasing in the short to medium term," said Norwell. "In fact, new research issued by AUT [recently] suggested that, at our current rate of supply, we won’t reach demand until the mid-to-late 2020s."
Looking at the price distribution breakdown, the number of properties sold for less than $500,000 across New Zealand slipped from 46.8% to 41.4% year-on-year.
Seven regions have median prices in excess of the half a million-dollar mark, including Auckland of course. Over the past 18 months, the Auckland market has been hovering around the $850,000 mark, and things are unlikely to change much in the near future.
"This incredibly stable market is positive for first-home buyers who are desperately saving to get a foot on the property ladder," Norwell said. "However, it’s also good for investors, buyers and sellers too, as it means that everyone knows what the market is doing – there don’t tend to be too many happy people when the market is particularly volatile."
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