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Residential Property Market Off To A Buoyant Start

Residential Property Market Off To A Buoyant Start - REINZ

January residential property prices eased slightly but sales volumes were well up indicating a much more liquid market than previous years, according to the Real Estate Institute of New Zealand.

REINZ national President Mr Rex Hadley said that although January was generally regarded as a relatively quiet month in real estate because of the holiday season, the New Zealand total sales volume of 6,771 house transactions “is very encouraging and bodes well for the rest of the year”.

The latest sales volumes compare with the figure of 6,147 recorded in December and were significantly up on the January 2001 figure of 4,741.

Median prices eased nationally from $178,000 in December to $175,000 for January 2002, but have held up on a year-to-year basis being the same as the January 2001 figure.

“What these figures are telling us is that market liquidity has improved, people are finding it much easier to transact residential property and are perhaps not as fixed in their pricing attitudes as they are in tighter economic times when medians can hold up but volumes tend to fall considerably.

Mr Hadley said continued low interest rates and a very competitive mortgage market were obviously contributing factors to the more buoyant market.

“We are also pleased that the much higher volumes are not translating into sharp price increases which indicates that people are taking a more mature approach to residential property and that the heated environment in areas like Auckland in the mid 1990s is not likely to be repeated. We suspect that the low interest rates are encouraging people to reduce their mortgages which is what they should be doing.”

While medians slipped in the main centres generally on both a month-to-month and year-to-year basis were exceptions with median increases in some smaller provinces.

The Nelson/Marlborough median increased from $147,500 in December to $158,000 in January, also above the January 2001 figure of $152,000.

Otago also recorded a small increase in its median from $95,000 in December to $98,000 in January 2002 however this was below the January 2001 median of $109,000.

In Southland the story was the same, an increase in the January 2002 median to $80,000 from $78,500 in December, but well down on the January 2001 median of $106,000.

In the larger centres medians came back, with Auckland falling from $253,800 In December to $245,000 in January, but remaining above the $240,000 median of January 2001.

Wellington’s median dropped from $195,000 in December to $191,000 in January, below also the January 2001 median of $195,000.

In Canterbury/Westland the $140,000 median was down on both December’s figure of $147,000 and the January 2001 figure of $142,000.

Some of the more notable year-on- year sales volume increases included Auckland up from 1,450 sales last January to 2288, Hawkes Bay up from 173 to 246, Otago up from 272 to 357 and Southland almost doubling turnover at 299 sales compared with 157 in January last year.

-ENDS-

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