Buyers remain in control as market appears closer to the bottom

Property prices in New Zealand are still declining, but buyer activity is on the rise, according to Real Estate Institute of New Zealand (REINZ) data from June.

Over the year to June, New Zealand’s median house price fell 9.0%. However, it fell only 1.2% over the quarter, suggesting prices are falling at a decelerating rate.

A similar picture has been playing out for house prices in the country’s largest cities:

  • Auckland = down 0.9% over the quarter, down 10.6% over the year.
  • Christchurch = down 1.3% over the quarter, down 6.8% over the year.
  • Wellington = down 0.3% over the quarter, down 10.5% over the year.
  • Hamilton City = down 0.8% over the quarter, down 9.6% over the year.
  • Tauranga = down 0.7% over the quarter, down 9.1% over the year.
  • Lower Hutt City = up 0.3% over the quarter, down 13.6% over the year.
  • Dunedin City = down 4.7% over the quarter, down 6.9% over the year.
  • Palmerston North City = down 1.4% over the quarter, down 10.4% over the year.
  • Napier City = down 3.6% over the quarter, down 11.5% over the year.
  • Porirua City = down 1.1% over the quarter, down 10.7% over the year.

 

Sales rise, new listings fall

A total of 5,629 properties sold across New Zealand in June, which was 4.1% lower than the month before but 14.6% higher than the year before.

Historically, though, sales tend to fall between May and June. When those figures are seasonally adjusted, June sales exceeded expectations when compared to May, according to the REINZ.

While more properties are being sold, fewer homes are being listed for sale. The number of new listings in June was 15.5% lower than the month before and 21.2% lower than the year before. As a result, the total number of properties listed for sale in June fell 7.5% month-on-month and 6.1% year-on-year.

To add to the mix, the properties that were sold in June took a median of 49 days to find a buyer, which was unchanged on the month before and up four days from the year before.

 

Four key takeaways from all that data

  1. The slowdown in price falls suggests the market is getting closer to the bottom.
  2. The increase in sales volumes suggests some buyers are taking advantage of these falling prices.
  3. The decrease in new listings suggests some homeowners are holding off selling their home until prices resume rising.
  4. The increase in days to sell suggests conditions have shifted further in favour of buyers.

If history is any guide, property prices will, at some point, start rising again. In that case, now might be a good time to buy, while prices are lower and buyer competition is limited.

Do you want to take advantage of the current market to buy a house or investment property? If so, get in touch and I’ll be happy to compare home loans for you and manage your loan application.

 

 


Published: 18/7/2023
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