Central Otago housing market tightens as national trends continue

TWO trends continued to be the main theme in the New Zealand housing market, according to the latest data from realestate.co.nz.

Auckland’s housing market continued to move towards a buyers’ market as inventory levels crept higher.

Annual inventory growth in Auckland had been positive for the last 18 months. Weeks of inventory (a measure of the degree of tightness in the market) in Auckland lifted to 21 in April from 18 in March, only two weeks below its longterm average.

ASB economist Kim Mundy said soft sales activity appeared to be behind the lift in inventory levels in Auckland as annual new listings had been falling for the last five months.

Conversely, the Central North Island, Northland, Marlborough, Central Otago and Southland housing markets continued to tighten.

On top of falling inventory levels, weeks of inventory were also falling. Some regions were sitting well below longterm averages.

Northland’s weeks of inven tory remained steady at 26 in April, compared to a historical average of 95.

Marlborough was sitting at 14 against 16 in March and a historical average of 42.

Wellington continued to be New Zealand’s tightest market, sitting at eight weeks compared to a longtime average of 42. Hawkes Bay was close behind at nine weeks, also well below its historical average of 31 weeks.

‘‘It’s not surprising to see the relatively more affordable regions outperforming Auckland and other centres experiencing rapid house price appreciation in recent years.

‘‘In the nearterm, we expect to see these regional contrasts to remain evident as lower price areas close the gap with more expensive ones.’’

Regional New Zealand was not secluded from incoming legislation changes, Ms Mundy said.

There was a risk ongoing uncertainty around how the timing and impact of legislation would affect housing activity across the country.

As a result, ASB was expecting the housing market to continue to drift along for the remainder of the year, she said.