Canterbury Market Update - July 2024
We are now well in the depths of winter now, having just crossed the Winter Solstice and moving into the second half of the year. While winter is often a slower time for the property market, Canterbury has shown great resilience with plenty of active buyers and plenty of properties for sale.
For those who can successfully navigate the higher interest rates, it’s a great time to be looking for a property and with the right advice and support, there are plenty of great opportunities out there.
Who’s in the market right now?
First home buyers remain the most active group across Canterbury, especially in Christchurch and Timaru. The number of owner-occupiers moving homes declined in June, with many potentially opting for the warmer months to make the shift.
Investors are still few and far between, but with the positive changes made on the 1st of July, we expect to see activity begin to pick up once more, as the odds become more in favour for both investors looking to buy and sell.
Real estate agents report that open home attendance remains high across the region, with new listings attracting high numbers of buyers. Sellers are meeting the market with pricing expectations, so pricing remains on par with market conditions.
While it’s always a wait and see game, it’s hoped that things will pick up further the closer we get to Spring, as well as the hope around interest rates beginning to ease towards the end of 2024.
Regional sales statistics
The median house price for Canterbury in May was $680,000, which is up 1.5% on April and 4.5% on May 2023. Below are the house prices for May 2024 vs May 2023.
Bear in mind these can fluctuate quite rapidly depending on the price of the most recent sales - especially in the smaller districts where only a handful of houses may sell in a month.
Christchurch City - average price is $678,000, up 7.6% on last year
Ashburton - average price is $570,000, up 14.2% on last year
Hurunui District - average price is $610,000, down 18.7% on last year
Mackenzie District - average price is $600,000, down 20% on this time last year
Timaru District - average price is $495,000, down 1% on this time last year
Selwyn District - average price is $820,000, up 3.1% on this time last year
Waimakariri District - average price is $725,000, up 2.1% on this time last year
Waimate District - no sale data for May
Kaikoura District - average price is $827,000, no property info for this time last year
Regional sales information
During May, there were 740 residential sales, this is an increase of 21% from April 2024 and a 31% increase from May 2023, which was 561 sales. These results are great to see, and show that Canterbury is bucking the national trend of a slower market.
On average in the Canterbury region, a property sits on the market for 35 days. Compared to the month prior, this is 3 days longer.
Changes to market rules
In May the Government ended the First Home Buyers Grant rather abruptly, with only those who were already approved able to continue to use this. While this was frustrating for many first home buyers, this grant was not often the make or break of buying a home. The First Home Loan and KiwiSaver withdrawals are still the most helpful products for first time buyers wanting to get on to the property ladder. If you are unsure if you meet the criteria for these, reach out and we can help.
As of the 1st of July, a number of changes occurred in the lending space.
Loan to value ratios (LVR’s) were lessened which makes lower deposit lending more available, however Debt to income (DTI’s) were introduced, meaning that owner occupiers can now only borrow 6x their income, and investors 7x their income. While this might sound tight for some, the truth is it will not have much of an effect right away, as the bank's criteria and test rates will have an impact before the new DTI’s do.
Investors will be happy with changes to the Brightline test, with the period now reduced to 2 years rather than 10. It’s expected we might start to see a few more properties on the market as investors look to sell, however this could also mean more investors wanting to buy too, so could prove competition for first home buyers.
Overall, there’s still plenty happening in the local market and while it isn’t as hectic as we’ve seen in past years, there is still a lot of activity, especially for the time of the year.
For first home buyers there are some fantastic opportunities, with prices on the lower side and plenty to choose from. For investors, changes have made it a much more favourable market and we expect to see a lot more movement here over the coming months, and for owner-occupiers, while it can be slow to sell, there is also less pressure and competition when it comes to buying.
If you have any questions around the local market, or are looking for lending advice, then don’t hesitate to get in touch with our Christchurch mortgage advisors. We know exactly what’s happening both locally and nationally and are here to support you in any way we can. Just get in touch.