Regional Markets Strong in February Real Estate Market

News Release 11 March 2016

Regional Markets Strong in February Real Estate Market
Summary

• 7,291 dwellings sold in New Zealand in February 2016, up 44.4% on January and up 5.7% on February 2015. This is the highest number of sales in February for nine years.
• On a seasonally adjusted basis the number of dwellings sold fell by 1.67% compared to January.
• National median price of $450,000, up $20,000 (+4.7%) on February 2015 and up 0.4% on January
• New record national median prices in Waikato/Bay of Plenty, Hawke’s Bay, Wellington, Nelson/Marlborough and ‘New Zealand excluding Auckland’.
• A 17% rise in the number of sales over $1 million between February 2016 and February 2015 – from 577 to 675
• 20,093 dwellings sold by auction in the 12 months to February 2016, representing 22.1% of all sales, an increase of 43% in the number sold by auction in the 12 months to February 2015.

The Real Estate Institute of New Zealand (REINZ) which is the most up to date source of real estate data in New Zealand, announced today that there were 7,291 dwelling sales in February 2016, up 5.7% on February 2015. Excluding Auckland, the number of sales compared to February 2015 increased by 18.0%; and on a seasonally adjusted basis, total sales volumes increased 0.9% compared to February 2015 and 17.1%.

The national median price was $450,000 for February, an increase of $20,000 or 4.7% on February 2015, and up 0.4% compared to the previous month, January. Excluding the impact of the Auckland region, the national median price rose $33,000 to $383,000 compared to February 2015. Record median prices were also reached in Waikato/Bay of Plenty, Hawke’s Bay and Wellington and Nelson/Marlborough.

REINZ Chief Executive Colleen Milne says: “The REINZ data for February sales underlines the surge of activity in regional markets over the past six months with a number of regions recording strong increases in sales volumes compared to this time last year; the percentage rise of median prices rising ahead of the Auckland region; significant drops in the levels of inventory in the regions and, in a number of cases, noticeable drops in the number of days to sell.

“The Canterbury/Westland and Auckland region, which were previously the drivers of the national real estate market, are now playing ‘second fiddle’ to markets such as Waikato/Bay of Plenty, Hawke’s Bay and Central Otago Lakes. Other regions such as Wellington, Southland and Manawatu/Wanganui are also showing renewed vigour.”

Sales Volumes
There were 7,291 unconditional residential sales in February, a 5.7% increase on February 2015 and a 44.4% increase on January. February generally records a large percentage increase on January, due to January being the lowest sales month of the year. On a seasonally adjusted basis, however the number of sales fell 1.6% from January to February.

Sales volumes excluding Auckland were up 18.0% on February 2015 and up 17.1% on a seasonally adjusted basis. Southland, Hawke’s Bay, Taranaki and Wellington all showed annual sales growth in excess of 25%. In contrast, Auckland saw the number of sales shrink by 18% compared to February 2015.

All regions recorded double digit increases in sales volumes compared to January despite the increased number of holidays compared to February last year. Compared to February 2015, 10 regions recorded increases in sales volume, with Southland recording the largest increase of 40%, followed by Hawke’s Bay with 35% and Taranaki with 29%.

Prices
The national median house price rose $20,000 (+4.7%) to $450,000 from February 2016 to February 2015. In comparison with January the national median house price increased by $2,000 (+0.4%). Excluding the Auckland region, the national median price rose $33,000 (+9.4%) compared to February 2015. On a seasonally adjusted basis, the national median house price rose 1.6% compared to February 2015.

Waikato/Bay of Plenty, Hawke’s Bay, Wellington, Nelson/Marlborough and “New Zealand excluding Auckland” each recorded new record median prices in February. Waikato/Bay of Plenty recorded the largest percentage increase in median price compared to February 2015, at 16.7%, followed by Hawke’s Bay at 14.0% and Central Otago Lakes at 13.7%. Auckland recorded the fifth largest increase in the median price at 11.1%. Southland recorded the largest percentage increase in median price compared to January, with a 16.2% increase, followed by Wellington, 14.5%, and Manawatu/Wanganui, 8.2% increase.

Auctions
There were 1,300 dwellings sold by auction nationally in February, representing 17.8% of all sales and an increase of 28 (+2%) on the number for February 2015. The 20,093 sales by auction in the 12 months to February 2016 represented 22.1% of all dwelling sales, compared to 18.6% (14,055 sales) for the year ending February 2015.

Transactions in Auckland no longer represent the majority of national auction sales, with only 49.1% of all auction sales in the region. In comparison Auckland represented over 70% of all auction sales in February 2015. In contrast. the number of auction sales in Waikato/Bay of Plenty increased from 9.0% in February 2015 to 24.7% in February 2016, a year-on-year increase of 209%. Central Otago Lakes also recorded a new record number of sales by auction in February.

Further Data
Across New Zealand the total value of residential sales in February, including sections, was $4.232 billion, compared to $2.894 billion in January and $3.801 billion in February 2015. For the 12 months ended February 2016 the total value of residential sales was $54.402 billion. The breakdown of the value of properties sold in February 2016 compared to February 2015 is as follows:

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REINZ_Regional_Commentary__February_2016.pdf

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