Stable prices bring ‘cautious confidence’ to the market

More Kiwis slipping off their shoes and stepping into open homes signals a lift in confidence in the New Zealand property market. New listings hit a record low for July while stock was also down 12.4% year-on-year.  

Vanessa Williams, spokesperson for realestate.co.nz, says this suggests vendors remain hesitant to sell despite stock starting to move.  

“We are hearing from real estate agents that stabilising prices have increased buyer interest, and our data supports this.”

Just 6,156 new listings came onto the market nationally last month – around half the number seen in 2007 when realestate.co.nz records began. Stock was also down in 10 of 19 regions year-on-year, with just 23,090 total homes for sale nationally in July.  

Nationally, prices have been stable since the beginning of 2023, sitting around $870,000. Vanessa says increased certainty around price can appeal to buyers and sellers alike.  

“The OCR remaining flat last month, for the first time since August 2021, may have also given Kiwis some comfort given the current climate. Although I will add that, since this announcement, banks have increased retail lending rates to around 7.0%.”  

Properties selling under the hammer are reported to be up, and data shows that vendors are returning to auction rooms around the country too. Last month, 22.1% of all listings were listed for sale by auction, up from just 15.3% in July 2022.  

Lowest July on record for new listings

New listings were at an all-time low for any July on record last month in all regions except Marlborough and West Coast. Down 17.6% nationally, 10 of 19 regions saw new listings drop by more than 20.0% year-on-year.

Excluding April 2020, when the country was in lockdown, this is one of the lowest months of new listings since records began 16 years ago. 

“Only 6,156 properties went up for sale last month, which means new supply is limited for buyers around the country.” 

Only Marlborough saw a lift last month, with an increase in new listings of 12.5% year-on-year. However, Vanessa explains that the small regional market is prone to fluctuations, with just 72 new listings hitting the market in July. She adds that listings appeared to have been unusually low in July 2022. 

Stock down in July 

Last month 23,090 homes were on the market, 12.4% less than in July 2022. Vanessa says stock levels have been trending downwards since April:  

“I think we perhaps have a perfect storm with some vendors waiting until after the election to list. At the same time, we are seeing this increase in confidence thanks to stable prices and a so-called end in sight to interest rate increases.”  

She adds that the number of people searching for property on the realestate.co.nz site was up 7.7% last month and the app by 35.5% compared to the same time in 2022*.

“If you are thinking about selling, now might be a good time, as there is interest around the country,” says Vanessa.

Northland, Taranaki, Nelson & Bays, West Coast, Canterbury, Southland, Coromandel, Marlborough and Central North Island all bucked the national trend with a year-on-year increase in stock levels.  

National average asking price stable

Sitting just below $870,000, the national average asking price has remained stable since the beginning of the year. Although down more than $100,000 from the property market peak in January 2022, the minimal changes to the national average asking price throughout 2023 may encourage buyers and sellers. 

“We have seen prices starting to level out in several regions this year after a turbulent 2022 of price drops around the country,” says Vanessa. 

Month-on-month, only three regions saw their average asking price change by more than 5.0%. These regions were Coromandel (up 5.9%), Gisborne (up 8.3%), and Southland (up 9.2%). The rest remained static or changed by less than 5.0%.

Vanessa says this is good news for property owners looking to buy and sell in the same market:

“Stable prices mean people transacting property will likely buy at the same price level, which might not have been the case in 2022 when average asking prices were decreasing considerably month-on-month in some regions.” 

RE_Maps_July_2023

Central Otago/Lakes District first NZ region to hit $1.5m average asking price 

Once again bucking the national trend, Central Otago/Lakes District hit an all-time average asking price high last month. At $1,541,788, the region is the first in New Zealand to reach an average asking price of more than $1.5 million. 

Unlike the rest of the country, average asking prices in Central Otago/Lakes have been trending upward since the beginning of 2022. Vanessa says the tourism mecca appears to exist within an economic microclimate

“Demand remains high in this region, and it would seem that buyers, many of whom are based overseas, are not as impacted by rising interest rates and household inflation.”

“And might I say, what a fabulous part of New Zealand to buy property in.”

*Source: Internal metrics (July 2022 v July 2023). 

For media enquiries, please contact:

Hannah Franklin | hannah@realestate.co.nz

Notes to editors:

realestate.co.nz prides itself on providing accurate data and useful market insights to New Zealanders with its extensive 16-year dataset. Unfortunately, this month we made a mistake in our original release by reporting stock figures inaccurately. This was down to a human error, and we have now strengthened our processes to ensure something like this doesn’t happen again.  

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