Sales Volumes Ease, Prices Rise Modestly in Real Estate

11 November 2011

Sales Volumes Ease, Prices Rise Modestly in Spring Real Estate Market

Real Estate Institute of New Zealand (REINZ) data on the New Zealand housing market for October 2011 showed 5,007 unconditional sales for the month, up 1,104 sales (+28.3%) compared to October last year. The October figure is 228 lower than last month (-4.4%); however on a seasonally adjusted basis the volumes are almost flat showing a 0.5% drop. The national median house price rose by $9,000 to $359,000 (+2.6%) in October compared to September and is also up $9,000 (+2.6%) compared with October 2010.

Only four markets showed an increase in sales volumes during October, with Taranaki, Wellington, Nelson/Marlborough and Southland all reporting increases. Taranaki recorded the strongest lift in volumes at 15.5%, followed by Wellington (+7.6%) and Southland (+2.4%). Northland reported the largest drop in volumes compared to September (-28.7%) although this was after a strong lift in volumes in the previous month. Interestingly volumes in the Auckland market fell by 4.7% whereas the normal seasonal pattern would have predicted a modest increase compared to September.

Southland recorded the strongest lift in prices for the month of October (+19.3%), followed by Taranaki (+11.1%) and Central Otago Lakes (+9.1%). Compared to October 2010, Southland also recorded the strongest lift in prices (+20.4%), followed by Central Otago Lakes (+9.1%) and Nelson/Marlborough (+7.3%).

“The volume figures for October suggests that the spring ‘lift’ widely expected in the real estate market has been muted, but so too has any impact from the Rugby World Cup and European uncertainty”, said REINZ Chief Executive Helen O’Sullivan. “Volumes are up strongly compared to this time last year, but that in part reflects a very weak October 2010 when sales volumes were amongst the lowest in the past 20 years”.

“We are seeing plenty of activity, but buyers are still very price conscious. They will move quickly when they find a property that meets their needs, but properties perceived by prospective buyers as over priced are not generating much interest at all.”

The national median ‘days to sell’ improved by 2 days from 37 days in September to 35 days in October. The days to sell were at 41 days in October 2010. The days to sell measure continues to trend downward and has now fallen by 10 days over the past five months, from 45 days in May to 35 days in October.

Otago recorded the shortest days to sell at 30 days (-6 days), followed by Southland at 31 days (-5 days), and Canterbury/Westland next with 32 days (-6 days). Central Otago Lakes recorded the longest number of days to sell at 57 days (-22 days), followed by Northland at 50 days (-6 days). Over the past five years the median days to sell has averaged 41 days across New Zealand.

Further Data

Across New Zealand the total value of residential sales, including sections was $2.15 billion in September 2011, compared to $2.27 billion in August 2011 and $1.60 billion in October 2010.

The breakdown of the value of properties sold in October 2011 is:

$1 million plus | 167 | 3.3%
$600,000 to$999,999 | 601 | 12.0%
$400,000 to $599,999 | 1,306 | 26.1%
Under $400,000 | 2,933 | 58.6%
All Properties Sold | 5,007 | 100.0%

The REINZ Housing Price Index fell 0.3% in October compared with September. The REINZ Housing Price Index recorded increases in Wellington, Other North Island and Other South Island in October, with falls in other markets. Compared to October 2010 the REINZ Housing Price Index rose 3.4%, and the Index is now 3.3% below the peak recorded in November 2007.

For more real estate information and market trends data, visit www.reinz.co.nz. For New Zealand's most comprehensive range of listings for residential, lifestyle, rural, commercial, investment and rental properties, visit www.realestate.co.nz - REINZ's official property directory website.

ENDS

© Scoop Media