July real estate market in winter mode
News Release 12 August 2014
July real estate market in winter mode
dwellings sold in July 2014, up 2.3% on June but down 13.0%
on July 2013
• National median price of $416,000, down $11,250 (-2.6%) on June and up $31,00 (+8.1%) on July 2013
• Days to sell improved by two days to 37 days compared to June, although eased two days compared to July 2013
REINZ, the most up to date source of real estate data in New Zealand, announced today that there were 5,893 dwelling sales in the month of July, down 13.0% on July 2013 and up 2.3% compared to June. The national median price was $416,000 for the month of July, an increase of $31,000 compared to July 2013, but a fall of $11,250 from June.
Real Estate Institute of New Zealand (REINZ) Chief Executive Helen O’Sullivan says, “The real estate market is firmly in winter mode at present with listings low and activity muted across the country. Sales volumes picked up a little in July compared to last month but this is about in line with the normal seasonal pattern. Rising interest rates and the forthcoming election are probably also influencing buyer behaviour.”
“Reports on the effects of the LVR restrictions continue particularly from the regions, where the reported lack of able buyers is filtering up the price points and on to vendor behaviour. In this context it is worth noting that Auckland and Canterbury/Westland accounted for more than 100% of the increase in the national median price between July this year and July last year, a further indication that the ‘national price’ is being driven by these two regions alone.”
REINZ data shows there were 5,893 unconditional residential sales in July, a 2.3% increase on sales recorded for June, and a 13.0% fall from July 2013. Typically, sales in July are higher than June, however on a seasonally adjusted basis the level of sales was about flat compared to June and down 13.0% compared to July 2013.
Eight regions recorded an increase in sales volume compared to June with Hawkes Bay recording the largest increase of 22.1%, followed by Otago with 12.4% and Manawatu/Wanganui with 12.0%. Compared to July 2013 nine regions recorded a decrease in sales volume with Otago recording the largest fall of 20.8%, followed by Hawkes Bay with a fall of 19.8% and Auckland with a fall of 18.7%.
While the total number of sales was down 13.0% compared to July 2013, the number of sales below $400,000 fell by 21.8%. This follows a fall in sales below $400,000 of 17.3% between June 2013 and June 2014. This may be indicative of fewer sales in the lower price brackets since the imposition of the LVR restrictions.
The national median house price fell by $11,250 (-2.6%), from $427,250 in June, to $416,000 in July. Compared to July 2013 the national median house price increased by $31,000 (+8.1%), with five regions recording an increase in the median price. 83% of the increase in the national median price compared to July last year occurred in Auckland, with Canterbury/Westland contributing 19% of the increase and Waikato/Bay of Plenty contributing 9%. Together these three regions accounted for 111% of the increase in the median price between July 2013 and July 2014, with the remaining nine regions contributing -11% of the increase in the median price.
Canterbury/Westland recorded the largest increase in median price compared to July 2013, with an 11.1% increase, followed by Auckland with a 10.5% increase and Waikato/Bay of Plenty with a 5.8% increase. Compared to June, Southland recorded the largest increase in median price, up 4.2%, followed by Otago with 3.8% and Auckland with 1.7%.
The REINZ Stratified Housing Price Index, which adjusts for some of the variations in the mix that can impact on the median price, is 5.9% higher than July 2013, at 3885.5. The Auckland Index has risen 12.2% compared to July 2013, with the Christchurch Index up 13.9% and the Wellington Index down 2.3%.
Days To Sell
Dwellings took two days less to sell in July compared to June at 37 days. Compared to July 2013, the median number of days to sell was two days longer. Four regions saw an improvement in the number of days to sell between July 2013 and July 2014, with Southland recording the largest improvement of six days. Auckland saw its number of days to sell ease by three days.
For the month of July, Canterbury/Westland recorded the shortest days to sell at 30 days, followed by Auckland at 32 days and Otago at 37 days. Northland recorded the longest number of days to sell at 76 days, followed by Manawatu/Wanganui and Central Otago Lakes with 59 days. Over the past 10 years the median days to sell for the month of July has averaged 39 days across New Zealand.
Nationally there were 978 dwellings sold by auction in July representing 16.6% of all sales, and a reduction of 403 on the number of dwellings sold by auction in July 2013. For the 12 months to July 2014 the total number of sales by auction was 14,831 or 19.8% of all sales, compared to 15,221 or 19.3% of all sales for the 12 months to July 2013.
Transactions in Auckland again dominated the auction market in March, representing 68.7% of the national total of auction sales. 30.0% of all dwelling sales in Auckland were by auction in July, compared to 38.1% of sales by auction in July 2013. Sales by auction in Waikato/Bay Of Plenty accounted for 9.4% of the national total, Canterbury/Westland accounted for 13.9% of the national total, and all other regions combined accounted for the remaining 8.0% of auction sales in July 2014.