Property Prices Decline Further In June, With Listings Taking Longer To Sell

The national average asking property price has retreated, with prices dropping 1.9 per cent to $841,550, the lowest so far for 2024, according to the latest Trade Me Property Price Index.

Trade Me Property Sales Director Gavin Lloyd said that this marked the third consecutive month on month decline in prices. "We often see buyers take their time in the winter months and the market tends to slow down. But this is also reflecting the wider economic conditions - we’ve been hovering in and out of recession, the rising cost of living and also record outflows of people leaving New Zealand.”

“Even with the easing of loan-to-value ratios (LVRs) and Brightline testing we are yet to see this make a significant impact on the market. Coupled with high interest rates and a high rate of new listings, which provide buyers with more choices, it’s unsurprising that prices have continued to trend downward,” said Lloyd.

“While these changes might entice investors in particular back into the market, many will be hoping for interest rates to drop, so won’t be rushing into making purchases, while first home buyers may need to keep saving for a larger deposit with the removal of the first home buyer’s grant and stricter lending criteria of debt to income ratios,” added Lloyd.

Supply and demand start to ease

Market activity has also started to slow with demand and supply both dropping by 7% compared to May. The largest drops in supply were in Wellington, the West Coast and Southland, all down 10 per cent.

This comes after a bumper number of listings went up for sale in May. "With more properties on the market creating more competition, it does put pressure on sellers to ensure their listing stands out. Working closely with a local real estate agent is vital when selling, as they can advise on the best way to present the property and will have in-depth knowledge of the local area," said Lloyd.

He pointed out that despite supply dropping, the time properties were remaining listed on site has extended again. "In June, the median days on site increased to 73, which is five days more than in May - which could also be playing a role in keeping prices down. While we tend to see listing times extend in winter, Auckland is seeing the highest for June since we first started recording this in 2020." he noted.

No increases across all regions recorded for the first time

Asking prices fell or remained flat across the country - except for Nelson/Tasman which was the only region that recorded an increase.

The biggest drops were in Otago and Marlborough, with both recording 3.4 per cent, followed by Wellington at 3.1 per cent.

Mr Lloyd said looking across the regions the data shows that no areas are immune to the winter slump, but that recent job cuts in the capital could be impacting house prices in the region.

“Commuter zones where families tend to live like Porirua and South Wairarapa recorded the biggest drops of 6.9 per cent.

“With job cuts in the public sector, there are less people wanting to move into the surrounding areas, and those that have been impacted may be looking at options to relocate to a new city - or even a new country in order to secure a job. Incoming council rate hikes of 16.9 aimed at helping the cities infrastructure woes will also be unappealing for residents as well.”

“Wellington is usually one of the most expensive places to live after Auckland, but we’ve now seen that drop below the Bay of Plenty and Nelson,” Lloyd added.

Urban properties in Christchurch buck trend

Despite the average asking price falling across the motu, urban properties in Christchurch recorded a year on year increase of 0.5 per cent in June to $581,300.

Mr Lloyd said that although this is a small increase it stands out against the national average which dropped 3.2 per cent. "Urban properties in Christchurch City have been consistently outperforming Auckland and Wellington - holding their value while other regions have seen large price drops. In June, apartments in particular saw a 13.8 per cent increase to $738,850.”

“The Garden City has managed to hold prices steady and smaller properties there are continuing to increase in value with 1-2 bedrooms up 4.3 per cent to $537,950 and 3-4 bedrooms recorded at $761,000, up by 4.1 per cent,” he added.

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