Winter Temperatures Cool the Market
Data released today by the Real Estate Institute of New Zealand (REINZ) shows there were 58 less lifestyle property sales (-3.0%) for the three months ended June 2019 than for the three months ended May 2019. Overall, there were 1,876 lifestyle property sales in the three months ended June 2019, compared to 1,995 lifestyle property sales for the three months ended June 2018 (-6.0%), and 1,934 lifestyle property sales for the three months ended May 2019.
6,867 lifestyle properties were sold in the year to June 2019, 380 (-5.2%) fewer than were sold in the year to June 2018. The value of lifestyle properties sold was $5.48 billion for the year to June 2019.
The median price for all lifestyle properties sold in the three months to June 2019 was $690,000 and was $32,500 higher compared to the three months ended June 2018 (+4.9%).
Brian Peacocke, Rural Spokesman, at REINZ says: “Sales volumes for the 3 month period ending June 2019 are at their lowest level for several years, and to some extent, reflect the easing of sales volumes experienced in the residential sector.
“The median price for the period is consistent and at $690,000, is in line with the strong levels of recent months, perhaps also reflecting a shortage of stock in some areas.
“Consistent also are the reports from around the country indicating a much harder stance being adopted by the trading banks, where strong equity levels and good healthy cash flow are not necessarily a guarantee of success in applications for funds,” he concludes.
Interest around New Zealand
• Northland/Auckland - a holding of sales volumes in Northland but an easing in the Auckland area where the market is now deemed challenging, this following a period of good sales which in turn follows a good period for listings; reports currently suggest listings are harder to obtain with indications of sales being harder to achieve in the higher level of the market, above $2.5m, where prices have eased by up to 5%; by contrast the lower end from under $1m and up to $1.3m is solid and holding; on a different note, premium prices previously relating to future urban land have eased with purchasers being more selective in choice and criteria
• Central Region - an easing of sales numbers in volume but some strong prices in the Waikato and Bay of Plenty contrasted by slight gains in Taranaki and Gisborne; a busy market above $800,000 albeit slower above $1.2m in Hawke’s Bay where the supply of listings is tightening amid reports of some small vineyards being purchased for lifestyle living
• Lower North Island - an easing in sales volumes compared to the previous month due in part to lower supply, but consistently strong prices on the Kapiti Coast
• Nelson/Marlborough - a solid lift in activity and results during June with some good sales at the top end of the market in the Tasman region
• Canterbury - a dramatic 40% drop in sales volumes from the previous month as the regional market cools with reports of fewer buyers in circulation
• Otago - a drop in sale numbers but due to the steady influx of people into the region, some particularly strong results if the right property becomes available, whether it be in the Dunedin, Alexandra, South Otago or the Lakes districts
• Southland - a similar reduction in sales volumes as being experienced by their neighbouring province but nevertheless, the market is considered strong for those properties currently available.
Three regions recorded an increase in sales compared to June 2018. Otago recorded the most substantial increase in sales (+32 sales) in the three months to June 2019 compared to June 2018. Compared to May 2019, eight regions recorded an increase in sales.
Eight regions saw the median price of lifestyle blocks increase between the three months ending June 2018 and the three months ending June 2019. The most notable examples were in Hawke’s Bay (+45%), Gisborne (+21%) and Southland (+21%) and the most notable exceptions were Auckland (-11%) and Canterbury (-4%).
The median number of days to sell for lifestyle properties was two days longer in the three months to June 2019 as in the three months to June 2018, sitting at 62 days. Compared to the three months ended May 2019 the median number of days to sell was one day longer. Southland recorded the shortest number of days to sell in June 2019 at 39 days, followed by Hawke’s Bay (50 days) and Manawatu/Wanganui (53 days). West Coast recorded the longest number of days to sell at 180 days, followed by Northland at 81 days, Auckland at 74 days and Taranaki at 73 days.