Sales and prices drop as housing market adjusts

AUCKLAND: The reality of a housing market pullback was reflected in new data which showed sales tumbled 35.2% annually, monthly prices were down and fewer homes sold in every New Zealand region.

Real Estate Institute figures said there were 7497 national house sales in the year to April, 2021, but only 4860 sales in the year to April 2022.

From March to April this year, the national median sale price fell from $890,000 to $775,000 and Auckland prices were down from $1.2 million to $1.1 million. Queenstown suffered one of the biggest drops, from March’s $1.4 million to just $950,000 based on all the sales in April.

Dunedin prices fell from $649,000 in March to $640,000.

In further signs of the adjustment now under way, sales volumes fell in all regions, particularly Marlborough down 53.6%, Auckland down 41.3%, Hawke’s Bay down 39% and the West Coast down 38.3%.

Jen Baird, REINZ chief executive, acknowledged the market change.

‘‘We’re seeing a slowdown in activity. There is more stock staying on the market for longer and while annual price growth is more moderate, the monthonmonth trend shows a fall in median prices,’’ she said.

New Zealand was now in a phase of the property cycle where ‘‘demand has weakened and sales counts are down, more stock is staying on the market longer and the month on month trend shows a fall in median prices,’’ she said.

‘‘April residential property sales decreased annually by 35.2% across New Zealand, a story reflected across all regions,’’ Ms Baird said.

Falling attendance at open homes and auction rooms and a decrease in buyer inquiries are being reported across New Zealand, exacerbated by a spate of public holidays through April.

‘‘Affordability, uncertainty and changing financial conditions remain primary concerns,’’ she said.

Tighter lending criteria, loan to value ratios, rising interest rates and inflation created challenges for some buyers, particularly firsthome buyers and investors.

Those who are backed by equity and secure in a job market with a low unemployment rate will continue to see opportunity as more stock increases choice and prices ease, she predicted.

Owneroccupiers are now the most active in the market. That meant a softening in the mid to lowprice range but solid interest in the mid to high bracket.

The REINZ House Price Index, which measures the changing value of residential property nationally, showed an annual increase of 6.3% from 3774 last April to 4013 last month, although it is down 6.2% from its peak last November 2021.

Properties for sale rose 71% from 15,838 last April to 27,050.

In Auckland, it takes longer to sell a house: 40 days now which is more than the 10year average for April which is usually only 34 days. There are 23 weeks of inventory for sale in Auckland now, 14 weeks more than at the corresponding time last year. —