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News Release 12 March 2013

Late Summer Surge for Real Estate Market In February

Summary

• 6,632 houses sold in February 2013, an increase of 34% on January and up 7.5% on the same month last year
• National median house price up 7.6% compared to February 2012, Auckland up 14.3%; the national median house price is $7,000 below the record set in December 2012
• Stratified Housing Price Index reaches new record high of 3,544.9
• New record median house price for Canterbury/Westland
• Sales by auction increase by more than 80% in February 2013 compared to February 2012

February residential property sales climbed to the highest level for the month in six years with the number of sales up 34 per cent on January.

The national median price rose 7.6% to $382,000 compared to February 2012 but remains below the record $389,000 established in December 2012.

The Chief Executive of the Real Estate Institute of New Zealand (REINZ), Helen O’Sullivan, says that while the residential real estate remains active, the rate of growth in the number of transactions is slowing despite prices being near record levels.

“Supply shortages in Auckland and Christchurch are the main constraint, resulting in double digit price increases in those regions with the median days to sell from listing at around 33 days. Across the rest of the country activity is more modest which is reflected in smaller increases in regional median prices. “

“The continuing reduction in the number of days to sell between this year and last year is also indicative of more buyer pressure in markets across the country.”

Sales Volumes
REINZ data shows there were 6,632 unconditional residential sales in February, an increase of 464 sales (+7.5%) compared with the same time last year and an increase of 34.4% compared to January 2013. The increase over January is in line with the normal seasonal trends at this time of the year. The pace in the growth of the number of transactions appears to be slowing; the year on year increase in Feb 2012 over the Feb 2011 figure was 34.4%, while the increase in Feb 2013 over Feb 2012 is a far more modest 7.5%. On a seasonally adjusted basis February’s sales were in line with what would be expected at this time of the year.

All but two regions recorded increases in sales volume compared to February last year, with Northland recording an increase of 28.7%, followed by Auckland with 15.6% and Wellington with 11.7%. All regions recorded an increase in sales volume in February compared to January, with Central Otago Lakes recording an increase of 55.4%, followed by Southland with 51.2% and Wellington with 41.6%.
The number of transactions remains well below historic levels, with the number of transactions in February 2013 just 71% of the total recorded in Feb 2007 of 9,357.

Prices
The national median house price rose by $12,000, from $370,000 in January, to $382,000 in February; an increase of 3.2%, and is just $7,000 below the record median price of $389,000 set in December 2012. Canterbury/Westland recorded a new record high median of $355,000 in February with a 3.2% increase compared to January. All but two regions recorded an increase in median price in February compared to January, with Northland recording a 17.8% increase. The national median house price is up 7.6% compared to February 2012, with the Auckland median price up 14.3%, followed by Central Otago Lakes with 13.9% and Canterbury/Westland with 7.4%.

The REINZ Stratified Housing Price Index, which adjusts for some of the variations in mix that can impact on the median price, is 8.1% higher than February 2012 and increased 1.6% compared to January. The Christchurch Stratified Housing Price Index is up 12.3% compared to February 2012, while the Auckland Stratified Housing price Index is up 11.6%.

Days To Sell
Houses took two days fewer to sell in February 2013, following the usual seasonal pattern, compared to January 2013, improving from 41 days in January to 39 days in February. Compared to February 2012, the number of days to sell improved by seven days. All regions, with the exception of Northland, Nelson/Marlborough and Southland, saw an improvement in the number of days to sell between February 2012 and February 2013.

For the month of February, Canterbury/Westland recorded the shortest days to sell at 30 days, followed by Otago with 32 days, and Auckland with 33 days. Northland recorded the longest number of days to sell at 86 days, followed by Waikato/Bay of Plenty with 63 days and Hawkes Bay with 57 days. Over the past 10 years the median days to sell for the month of February has averaged 43 days across New Zealand.

Auctions
Nationally there were 1,238 dwellings sold by auction in February representing 18.7% of all sales, an increase of 80.5% on the number of dwellings sold by auction in February 2012. Again this change is in line with seasonal trends, as the shorter trading month in January means that fewer auction campaigns (usually about three weeks long) are commenced and completed in that month. Auctions are increasingly favoured as a sales method in certain centres; for the 12 months to February the total number of sales by auction reached 12,720 or 16.9% of all sales, compared to 7,488 or 11.7% of all sales for the 12 months to February 2012.

Transactions in Auckland again dominated the auction market in January, representing 71.9% of the national total of auction sales. 37.1% of all dwelling sales in Auckland were by auction in February; this was up strongly from the 21.1% of sales by auction in February 2012. Sales by auction in Waikato/Bay Of Plenty accounted for 9.0% of the national total, Canterbury/Westland accounted for 9.5% of the national total, and all other regions combined accounted for the remaining 9.6% of auction sales in February 2013.

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Further Data
Across New Zealand the total value of residential sales, including sections was $3.15 billion in February, compared to $2.24 billion in January, and $2.66 billion in February 2012. For the 12 months ended February 2013 the total value of residential sales was $34.95 billion.

The breakdown of the value of properties sold in February 2013 is:

$1 million plus 295 4.4%
$600,000 to$999,999 1,071 16.1%
$400,000 to $599,999 1,742 26.3%
Under $400,000 3,524 53.1%
All Properties Sold 6,632 100.0%

REINZ Stratified Median Housing Price Index
The REINZ Housing Price Index increased 1.6% in February compared with January to sit at 3,544.9 to reach a new record high. Auckland rose 4.4% in February, followed by Christchurch with 4.2%. For the 12 months to February, the Christchurch Index rose 12.3%, and the Auckland Index rose 11.6% compared to the National Index increase of 8.1%. Outside of the main centres, the Other North Island Index was the next strongest with an increase of 3.7% for the 12 months to February 2013.

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* CAGR is Compound Annual Growth Rate
* The Christchurch data needs to be treated with some caution due to compositional changes in the suburb mix caused by the earthquakes in the city

REINZ Stratified Median Housing Price Index Chart

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Click here to read: REINZ_February_2013_Regional_Data.pdf

Click here to read: REINZ_Residential_Market_Statistics__February_2013.pdf

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