Market weakens

Weakly positive house prices in October are being put down to uncertainty over the forming of the new Government.

Median house prices in October only nudged up a seasonally adjusted 1.2 per cent compared to the previous month, according to new figures from the Real Estate Institute of New Zealand.

However, on an annual basis the figures were stronger, with only Auckland and Nelson on the decline.

ASB economist Kim Mundy said the weaker results were not surprising, given the election uncertainty last month.

‘‘Ongoing soft sales activity is taking some of the heat out of the market and weighing on price growth,’’ she said. ‘‘We expect sales activity and price growth to remain subdued into 2018, given uncertainty around the impact of the new housing policies.’’

In Auckland prices were clearly off last year’s heady heights, down 3.2 per cent to $850,000 in the year to October – although they perked up a little on September.

REINZ’s chief executive Bindi Norwell said Auckland’s decrease was ‘‘predominantly the result of a large number of apartments being sold in the old Auckland city area which had brought down the price of the entire region’’.

The bigger picture was that house prices were still increasing, albeit at a slower rate.