Property Prices Drop To A Three Year Low

The national average asking property price has continued to decline, with prices dropping 1.1 per cent in July to $824,900, the lowest since 2021, according to the latest Trade Me Property Price Index.

Trade Me Property Customer Director Gavin Lloyd said that we haven’t seen prices this low since June 2021. "Back then the property market was just starting to bounce back after the initial effects of Covid and we ended up seeing record highs that year. However in the past two years, we’ve seen almost $150,000 shaved off the average house price which may help bring back buyers to the market.”

"Recently, several banks have begun lowering their interest rates, and just yesterday, the Reserve Bank unexpectedly reduced the Official Cash Rate ahead of schedule - with further predictions that the Bank may cut rates again before the year ends. So for those that have been thinking about buying a property, now could be the perfect opportunity to capitalise on low house prices and interest rates that are expected to fall further,” he said.

First home buyers Rebecca Stewart and Josh Fuller recently went unconditional on a property in Mairehau Christchurch, paying $640,000 for a three bedroom home with a 15% deposit. The couple researched prices by talking to real estate contacts and reviewing reports online including Trade Me.

Rebecca Stewart said that she and Josh made difficult sacrifices to get into their home and had some ‘silly debt’ to clear. “It's bloody hard, that's the part people don't actually see behind the scenes in reality. We don't go on date nights, we stick to buying one coffee a week as a treat. We make dinner and lunch from home. I don't even remember the last time I bought a much needed new item of clothing.”

“It’s all been worth it. Today, I have a big grin on my face and I feel a bit lighter. We know we've bought at the right time and at a very fair price. “Home ownership opens up doors, there’s more security and more options for the future. It’s a new chapter and we’re looking forward to being able to put down roots and make memories in this home.”

A tale of two islands

When looking at the year on year data, asking prices fell across most regions in the North Island while the South Island prices mainly saw increases.

Gisborne was the only region in the North Island that recorded a year on year increase in July with an 8.6 per cent increase to $637,700, the second most affordable region in the North Island behind Manawatū-Whanganui, where the average asking price is $573,150, down 3.7 per cent year on year.

In the South Island, every region recorded an increase year on year in July apart from Nelson/Tasman. That region recorded the biggest drop of 4.5 per cent making the average asking price $806,100. The West Coast had the largest increase of 14.8 per cent - however it’s still the most affordable region in Aotearoa with an average asking price of $479,300.

Christchurch properties start to see decline

All major cities recorded a decline in urban property prices in the month, including Christchurch, which had previously maintained steady prices.

Ōtautahi saw a drop of 0.3 per cent in the average asking price for apartments, townhouses and units to $572,150. Auckland City had the biggest drop of 6.1 per cent to $761,000 followed by Wellington City which fell 4.7 per cent to $673,750.

GavinLloyd said up until now Christchurch appeared to be immune to the decrease in asking prices.

"The Garden City has maintained its prices compared to Auckland and Wellington, with smaller properties continuing to increase in value. However, in July, we began to see a decline in the prices of apartments and townhouses.

Christchurch first home buyer Rebecca Stewart says she and partner Josh chose Christchurch after periods living in London and Auckland. “You definitely get more bang for your buck in terms of house prices in Christchurch.

“The rebuild is beautiful - I want to spend the day in the city, which I don’t feel like I want to do in Auckland. Sometimes a bigger, crowded city can feel more isolating, there’s an easier feel to Christchurch. Traffic is not a big thing here and I love being able to see snow on the mountains and then see the beach.”

Wellington prices lowest since January 2021

With population growth slowing and job availability declining in Pōneke, Wellington prices continue to fall. The average asking price in July decreased by 4.4 per cent to $864,100.

Mr. Lloyd noted that many buyers may have given up on finding a property within their budget close to the capital. However, he suggested that now could be the perfect opportunity for those searching in the region and could be surprised at how far their budget could stretch.

“Welington has been generally pretty expensive - especially for first home buyers, however with prices at the lowest point since early 2021, it could be a great opportunity for those who thought they were priced out of the market,” Lloyd said.

The most affordable region is currently Masterton - with an average asking price of $573,400. However for those that want to be close to the inner city the suburb of Te Aro is the cheapest option at $676,750, down 21.7 per cent year on year.

“Te Aro generally has smaller properties than other Wellington suburbs which is why it tends to be cheaper, and the drop of over 20 per cent suggests it could be undervalued. It’s nearly $400,000 cheaper than properties in nearby Khandallah, where the asking price is still over a million dollars,” noted Lloyd.

Supply of properties spikes in July

Market activity has also started to heat up with demand and supply both increasing year on year. The number of listings on Trade Me increased by 29 per cent year on year and listing views saw a 14 per cent increase.

All regions apart from the West Coast had an increase in the supply of listed homes. Gisborne had the biggest increase in listings available - up by 80 per cent compared to last year, Wellington also saw a bumper number of listings up 47 followed by Auckland which had a lift of 34 per cent.

Gisborne also had the biggest increase in demand, up 56 per cent. The West Coast and Marlborough were the only two regions which saw a drop, down by 26 per cent and 6 per cent.

Lloyd said the time properties were remaining listed on site has extended for the third month in a row. "In July, the median days on site increased to 75, which is two days more than in June - The days often skyrocket in smaller regions where there isn’t as much demand, Northland for example has the highest days on site at 106 days." he noted.

Homes in the $2.5m+ bracket had the largest number of days on site, up from 90 in July last year to 109 in July 2024.

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