Sales Volume Surge in February Real Estate Market

News Release 12 March 2015

Sales Volume Surge in February Real Estate Market

Summary

• 6,898 dwellings sold in February 2015, up 12.6% on February 2014 and up 42.5% on January
• National median price of $430,000, up $15,000 on February 2014 and up $4,000 on January
• A rise of 3.6% in the national median price in the 12 months to February 2015.
• A rise of 14.0% in Auckland’s median price, from $592,000 to $675,000, in the same period.
• A national median price, excluding the effect of Auckland sales, flat at $350,000 compared to February 2014.
• 1,272 dwellings sold by auction in February, 207 more than for February 2014.

REINZ, the most up to date source of real estate data in New Zealand, announced today that there were 6,898 dwelling sales in February 2015, up 12.6% on February 2014 and up 42.5% compared to January. This the highest February sales level since 2007.

The national median price was $430,000 for February, an increase of $15,000 or 3.6% compared to February 2014 and an increase of $4,000 or 0.9% from January.

Real Estate Institute of New Zealand (REINZ) Chief Executive Colleen Milne says, “The surge in sales volumes in February compared to January was a little stronger than is normal, but this partly reflects a catch up after there were fewer sales than expected in January.”

“The data also shows that there has been no increase in the median price for New Zealand, excluding Auckland, between February last year and February just gone. This underlines again the view that there are two distinct real estate markets in New Zealand – Auckland and the rest of the country. While politicians and policy makers focus on solutions to the Auckland region’s housing supply problems, they will also be right to reflect on the need to ensure that any national application of new policies doesn’t have an adverse effect on the rest of the country,” Milne says.

Sales Volumes
REINZ data shows there were 6,898 unconditional residential sales in February, a 12.6% increase on February 2014 and an increase of 42.5% from January. On a seasonally adjusted basis the number of sales rose 4.2% from January to February, indicating that February sales were higher than what would normally be expected for this time of year. This likely reflects the weaker than expected January volume figures.

All regions recorded an increase in sales volume compared to January, with Waikato/Bay of Plenty recording the largest increase, of 61.8%, followed by Canterbury/Westland with 58.6% and Hawkes Bay with 54.3%. In comparison with February 2014, nine regions recorded increases in sales volume, with Waikato/Bay of Plenty recording the largest, of 40.6%, followed by Otago with 21.8% and Northland with 17.1%.

Prices
The national median house price rose $4,000 (+0.9%) to $430,000 compared to January. In comparison with February 2014 the national median house price increased by $15,000 (+3.6%), with seven regions recording an increase. On a seasonally adjusted basis the national median house price eased 0.5% compared with January and rose 3.6% compared to February 2014.

Auckland recorded the largest percentage increase in median price compared to February 2014, at 14.0%, followed by Central Otago Lakes at 12.0% and Otago at 6.8%. Compared to January, Otago recorded the largest percentage increase in median price, at 7.0%, followed by Manawatu at 5.5% and Nelson/Marlborough at 3.4%.

The REINZ Stratified Housing Price Index, which adjusts for some of the variations in the mix that can affect the median price, is 6.1% higher than in February 2014, at 4,069.7. The Auckland Index rose 15.4% compared to February 2014, the Christchurch Index 6.1% and the Wellington Index was flat.

Days To Sell
Dwellings took a median of 41 days to sell in February, one day less than for January and the same as for February 2014. Seven regions saw an improvement in the number of days to sell compared to January 2015, with Taranaki recording an improvement of 19 days, Otago 11, and Auckland and Northland two.

Otago recorded the shortest median days to sell in February, at 31, followed by Auckland at 32 and Canterbury/Westland at 36. Northland recorded the longest median days to sell, at 72, followed by Manawatu/Wanganui at 65 and Waikato/Bay of Plenty at 59. Over the past 10 years the median days to sell in February has averaged 45 across New Zealand.Auctions
There were 1,272 dwellings sold by auction nationally in February, representing 18.4% of all sales and an increase of 207 on the number sold by auction in February 2014. The percentage of homes sold by auction in the 12 months to February 2015 was 18.6% (14,055 by number), compared to 20.5% (16,258 by number) for the year ending February 2014.

Transactions in Auckland again dominated the auction market in February, representing 70% of the national total of auction sales. 37.9% of all dwelling sales in Auckland were by auction in February, compared to 31.9% in February 2014. Sales by auction in Waikato / Bay Of Plenty accounted for 9.0% of the national total, Canterbury/Westland accounted for 12.6% and all other regions combined accounted for the remaining 8.0% of the national total in February 2015.

Further Data
Across New Zealand the total value of residential sales, including sections, was $3.801 billion in February, compared to $2.610 billion in January and $3.171 billion in February 2014. For the 12 months ended February 2015 the total value of residential sales was $41.288 billion. The breakdown of the value of properties sold in February 2015 compared to February 2014 is:

There were 173 more (+6.0%) sales under $400,000 in February 2015 compared to February 2014, compared to an increase of 773 sales (+12.6%) for all price brackets between the two periods.

REINZ Stratified Median Housing Price Index

The REINZ Housing Price Index rose 0.8% compared with January to sit at 4,069.7. Auckland rose 7.3%, Christchurch 2.8% and Wellington 2.3%. For the 12 months to February the Auckland Index rose 15.4%, the Christchurch Index 6.1% and the Wellington Index was flat. The National Index increased 6.1% compared to February last year.

* 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

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1. Deciles: For analysis, REINZ breaks real estate sales into 10 price bands to compare trends in prices and sales volumes across the market.

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.

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, up to 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.
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 to provide 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 the index is more likely to reflect genuine property price movements.

REINZ_Residential_Regional_Data__February_2015.pdf

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