Wanted: House, with sunlight
If the Wellington housing market were a shop with products on the shelf, there would only be enough stock for the next six weeks.
That grim assessment comes from the Real Estate Institute of New Zealand (REINZ), with new data showing the Wellington region has the most understocked housing coffers in the country – 843 houses, or enough stock for six weeks at current sales volume.
The chronic housing shortage was caused by other shortfalls: land, labour and materials.
It meant the median house price in the Wellington region had reached $882,700, up from $707,000 a year ago, the REINZ data showed.
Mark Coffey said that was bad news for first-home buyers.
‘‘It’s a vicious cycle because the lower the inventory gets, the more reluctant people are to put their home on the market,’’ the REINZ spokesperson said.
‘‘The market is such that unless you’re an unconditional cash buyer, you’ll never land a property.’’
Wellington first-home buyer Gabriela Jimenez Rojas, 24, has been searching for a house with her partner for over a year.
‘‘All we want is a two-bedroom house, with a little backyard space, and sunlight,’’ Jimenez Rojas said.
The couple could make offers as high as $700,000 after scrimping together a $100,000 deposit with parental help and savings, alongside being preapproved for a $600,000 loan. They had made eight unsuccessful offers so far.
‘‘I’m happy to do renovations, I’m happy to rip out carpet – I just want something habitable,’’ she said. ‘‘I want something that’s warm. Otherwise, we’ll feel like we’re living in a cave.’’
The severe housing shortage had the paradoxical effect of increasing house sales due to feverish demand.
March sales across the Wellington region had actually increased by 17.2 per cent with 911 sales, up from 777 sales a year ago – the highest count since March 2017.
Tommy’s Real Estate had a record sales month in March: 110 sales. Sales director Nicki Cruickshank said when houses hit the market they sold like hotcakes. ‘‘They just fly out the door.’’ The majority of houses sold within two to three weeks in Wellington, Cruickshank said.
She had noticed an influx of houses onto the market in the last week and suspected those sellers were homeowners ‘‘not wanting to miss the boat on getting a great price’’ following the Government’s housing announcements designed to cool the market.
Infometrics senior economist Brad Olsen said the new data didn’t reflect the impact of those announcements.
‘‘Things may well soften, or slow down quite considerably in the next few months.’’
Olsen cautioned that median house prices could be misleading, whereas the house price index took into account what had been sold and how that changed the overall composition of the region’s housing stock.
Wellington had reached a new high on that index, as the value of the region’s house market had increased by 31.2 per cent since the same time last year.
‘‘The alarm bells were already screaming, and I don’t know how much more they can ring before we start to see even more action,’’ he said.
The median house price in Wellington City had decreased slightly since last month, now $1,060,000.