Sales Growth Slowing Down; Prices Still Firming

News Release 20 October 2016

Sales Growth Slowing Down; Prices Still Firming

Summary

Data released today by the Real Estate Institute of NZ (“REINZ”) shows there were 155 more lifestyle property sales (+7%) for the three months ended September 2016 than for the three months ended September 2015. Overall, there were 2,230 lifestyle property sales in the three months ended September 2016, compared to 2,354 lifestyle property sales for the three months ended August 2016 (-5%), and 2,075 lifestyle property sales for the three months ended September 2015.

9,122 lifestyle properties were sold in the year to September 2016, 20% more than were sold in the year to September 2015 and is now the largest number of lifestyle properties sold in a 12 month period in the past 20 years. The value of lifestyle properties sold was $6.86 billion for the year to September 2016.

The median price for all lifestyle properties sold in the three months to September 2016 was $5,000 lower at $530,000 compared to the three months ended September 2015 (-0.9%). The median price fell $15,000 (-2.8%) compared to August.

“The very high volumes of lifestyle block sales for the three month period ending 30 September 2016 again confirms the strength and health of the market, to the extent that those high volumes appear now to be the norm,” says REINZ Rural Spokesman Brian Peacocke.

Regional highlights include:

Northland: A strong market in the range of $350,000 to $500,000, with buyer resistance over $700,000 to $800,000 – listings are in short supply.

Auckland: Listing supply had been tight but is now easing; sales are strong and improving, reflecting the strong residential market; sellers of rezoned land are re-entering the market at a very strong level but for some participants, a lack of understanding of the Auckland Unitary Plan is causing roadblocks.

Waikato: A strong market with a good level of sales; good enquiry and a good supply of listings, particularly to the south and east of Hamilton; Auckland buyers are still active in the market but local buyers remain dominant.

Bay of Plenty: A solid market with steady values.

Rotorua/Taupo: Strong sales at increasing values over last six months; good activity between $500,000 to $700,000 but slower over $1m.

Lower North Island: Increased volumes in Hawke’s Bay and Taranaki, with a significant drop in the Manawatu; a strong market in the Wairarapa with healthy support from Wellington.

Nelson/Marlborough: A strong market up to $750,000 with slowing activity over $800,000; evidence of Auckland buyers active in the market place.

Canterbury: An easing in the market with some volatility in volumes over the last four months.

Otago: A good strong market with additional support from buyers outside the region; solid pricing up to $950,000 but slower over $1m; an easing in the Lakes District where supply is tight; suggestions of the southern drift being constrained by limited employment opportunities.

Southland: Good properties continue to sell well, albeit slower over $1m; listings in short supply.

12 regions recorded an increase in sales compared to September 2015. Manawatu/Wanganui recorded the largest increase in sales (+69) in the three months to September 2016 compared to September 2015, Wellington saw an increase of 55 sales and Northland an increase of 35 sales. Compared to August 2016, three regions recorded an increase in sales. Compared to September 2015 the number of sales for the three months to September 2016 rose by 155 sales.

The national median price for lifestyle blocks fell by $5,000 (-0.9%) for the three months to September 2016 compared to the three months to September 2015. The median price for lifestyle blocks in Auckland rose by $176,500 (+18.1%) from $973,500 for the three months to September 2015 to $1,150,000 for the three months to September 2016. Over the same time period, the median price rose by 21.9% in Waikato to a new record of $585,000, and was steady at $600,000 for Canterbury.

The median number of days to sell for lifestyle properties improved by eight days in the three months to September 2016 compared to the three months to September 2105 to sit at 62 days. Compared to the three months ended August 2016 the median number of days to sell improved by one day. Auckland recorded the shortest number of days to sell in September 2016 at 43 days, followed by Bay of Plenty at 45 days Waikato at 48 days. West Coast recorded the longest number of days to sell at 201 days, followed by Taranaki at 101 days, and Otago at 100 days.

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Real Estate Institute of New Zealand

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.

Editors Note:

The information provided by REINZ in relation to the lifestyle real estate market covers the most recently completed three month period; thus references to September refer to the period from 1 July 2016 to 30 September 2016.

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