Volumes Up, Prices Steady in February Real Estate Sales

News Release 13 March 2011

Volumes Up, Prices Steady in February Real Estate Sales

February 2012 data from the Real Estate Institute of New Zealand (REINZ) indicates strong sales growth in the residential housing market, with 6,168 unconditional sales for the month. The volume of sales is up by 37.0% or 1,666 sales compared with the same time last year, and is the best February result the market has recorded since 2008. The national median house price remained steady for the third straight month at $355,000 and is up $5,000 (+1.4%) compared with February 2011. While the volume increase is significant, it is worth noting that the February 2012 result is just 65.9% of the 9,357 sales recorded in February 2007.

In line with the usual pattern for this time of year, February sales volume increased by over 50% compared to January. However, on a seasonally adjusted basis the national total was up just 3.0%. All regions apart from Otago and Canterbury/Westland recorded double digit growth compared to February last year; Otago recorded single digit growth, while Canterbury/Westland’s sales volume more than doubled compared to February last year when the market was impacted by the February 22 earthquake and its aftermath.

For the month of February, Otago recorded the highest lift in prices for the month (+6.3%), followed by Hawkes Bay with +4.6%, and Waikato/Bay of Plenty and Northland, both with 3.3%. Compared to February 2011, Canterbury/Westland also recorded the highest lift in prices (+14.0%), followed by Waikato/Bay of Plenty (+1.9%) and Otago (+1.8%). The REINZ Stratified House Price, which adjusts for some of the variations in mix that can impact on the median price, is 2.7% higher than February 2011.

“The real estate market in February has built on the strong results in December and January with a 37% lift in sales across the country compared to February last year and the highest number of transactions in a February month since 2008,” said REINZ Chief Executive Helen O’Sullivan. “While agents are seeing more activity and more positive sentiment from buyers in most places this is not translating into significant price increases. Agents in a number of areas continue to report listing shortages. Despite the increased number of transactions, buyers are remaining cautious with the days to sell measure down by just one day, and still above the long term average.”

“While most of the focus is on Auckland, as the nation’s largest real estate market, its sales volume change and price movements are very much ‘middle of the pack’, with a number of the provincial markets showing stronger year-over-year sales volume and price growth. The improvement in the Canterbury / Westland market is remarkable especially given the complexity of a sale transaction in a post-quake environment.”

The national median ‘days to sell’ fell by 1 day in February compared to January, from 47 to 46 days. Over the past five years the median days to sell has averaged 41 days across New Zealand.

Canterbury/Westland recorded the shortest days to sell at 35 days (-4 days), followed by Nelson/Marlborough with 37 days (-20 days) and Auckland with 38 days (+1 day). Northland recorded the longest number of days to sell at 71 days (-1 day), followed by Waikato/Bay of Plenty at 65 days (+2 days) and Taranaki at 64 days (+11 days.)

There were 686 dwellings sold by auction in February representing 11.1% of all sales, up from 393 sales (8.7%) in February 2011. Transactions in Auckland dominated the auction market, representing 63.7% of the national total of auction sales. 21.1% of all sales in Auckland were by this method. Transactions in Waikato/Bay Of Plenty accounted for 15.7% of the national total of auction transactions, and 12.0% of transactions in this region were by the auction method. Canterbury/Westland accounted for 9.6% of the national total of auction transactions, and all other regions combined accounted for the remaining 11.0% of auction sales.

Further Data

Across New Zealand the total value of residential sales, including sections was $2.66 billion in February, compared to $1.72 billion in January, and $1.91 billion in February 2011.

The breakdown of the value of properties sold in February 2012 is:

$1 million plus 201 3.2%
$600,000 to$999,999 768 12.5%
$400,000 to $599,999 1,515 24.6%
Under $400,000 3,684 59.7%
All Properties Sold 6,168 100.0%

The REINZ Housing Price Index increased 0.8% in February compared with January. The REINZ Housing Price Index recorded falls in Wellington, Other North Island and Sections. Increases were recorded in Auckland, Christchurch and Other South Island. Compared to February 2011 the REINZ Housing Price Index rose 2.7%, and the National Index is now 3.0% below the peak recorded in November 2007 (see table and chart below). The Auckland Index however is 0.7% above the previous peak recorded in July 2007.

Regional Data February 2012 pdf

Residential Market Statistics February 2012 pdf

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Editor’s Note:
The monthly REINZ residential sales reports remain the most contemporary and up-to-date statistics on house prices and sales in New Zealand. They are based on actual sales reported by real estate agents. These sales are taken as of the date that a transaction becomes unconditional and includes sales as of 5:00pm on the last business day of the month. Other surveys of the residential property market are based on information from Territorial Authorities regarding settlement and the receipt of documents by the relevant Territorial Authority from a solicitor. As such, this information involves a lag of four to six weeks before the sale is recorded by the Territorial Authority.
The REINZ Monthly Housing Price Index is calculated using a technique known as stratification, which provides an averaging of sales prices for common groups of houses. This approach is considered a more robust analysis of actual house price trends and was developed in conjunction with the Reserve Bank.
The REINZ Monthly Housing Price Index is based on a value of 1000 in January 1992, the first month for which electronic information is available. Changes in the index represent movements in housing prices, where the mix of sales between the groups is held constant and are more likely to reflect genuine property price movements.
© REINZ 2012. Unless otherwise indicated, REINZ holds the copyright and other proprietary rights on all material in this document. No part of this document may be reproduced or stored in a retrieval system in any form or by any means without the prior written permission of the copyright owner. REINZ does not accept responsibility should any information prove to be incomplete or incorrect.

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