Winter vendors in prime position
A lack of houses for sale is being credited for strong prices across the country – and would-be vendors are being told to make the most of it if they want to move.
The Real Estate Institute of New Zealand (REINZ) has released its latest statistics, which show the nationwide median asking price lifting 5.7 per cent to $560,000. Auckland’s median was flat at $850,000.
At the same time, the number of houses sold in June was down 23.2 per cent on May and 1.6 per cent on June 2017. In Auckland, turnover dropped by a quarter between May and June.
Only Hawke’s Bay and Taranaki had more sales month-on-month, on a seasonally-adjusted basis.
Craig Lowe, of Lowe and Co Realty, said vendors were traditionally reluctant to sell in the cooler months.
But he said it was often the better option because there was less competition. Everyone assumed summer would be preferable, when their house would look nicer or buyers felt better.
The number of properties available for sale nationally, 23,597, was 3.8 per cent lower in June than on the equivalent month last year.
The median number of days to sell a property nationally increased by two days from 36 days in June 2017 to 38 in June 2018. Excluding Auckland, it increased by one day.
Infometrics economist Brad Olsen said the drop in sales mid-year and a resulting price rise was nothing new.
‘‘But the fall in June has seen even less houses sold than in last year’s midwinter dip, continuing a worrying trend of low supply and high competition for the houses that are on the market.
‘‘Of the country’s 16 regions, half saw sales decrease in June compared to the year before – with [the] West Coast down 26 per cent, Waikato down 14 per cent, and Wellington down 11 per cent.’’
Sellers worried about standing out in a less frantic environment should not bank on do-it-yourself renovation efforts to help them, Lowe said.
‘‘People feel every dollar they spend they should get back, plus.’’
In a rising market, the momentum of a general increase in prices would hide the fact that many people were not getting as much of a price boost as they spent on the property.
Vendors were better to sell a property by offering potential for others to add value, he said.
Slower price growth will help some first-home buyers. The amount of lending to first-timers is increasing markedly, from $868 million in April to $1.116 billion in May.
Ashley Dodd had been trying to buy a house for five years before she finally succeeded in April.
Every house she looked at in Nelson had dozens of potential buyers. Finally she and her husband were able to buy through a private sale from friends.
She had noticed a change in the local market. Although prices were not declining, they were no longer shooting ahead like they were.
But she’s undecided if that’s a good change, if it continues.
‘‘Markets go up and down, as a firsthome buyer it was harder but it’s the way it is. It can’t always stay even or nobody would ever make money on their homes.’’