Residential property in high demand

Residential property in high demand as listings continue to fall

AUCKLAND, 1 July 2009 – A snapshot of activity across the New Zealand residential property market during June indicates stability is returning to the market, and that house sales could surge in the coming Spring.

According to the latest NZ Property Report, the available stock of houses on the market continued to fall last month, as the number of new listings was down significantly compared to June last year.

NZ Property Report is a monthly survey of market activity compiled by Realestate.co.nz, the country’s most comprehensive property listing website. The latest issue, covering June, has been released today.

According to the report, the number of new listings coming onto the market declined for the fourth consecutive month in June, and was down 24% compared to June 2008. A flow-on effect of this reduction in listings has been that the available inventory of residential property – measured in terms of the number of weeks of average sales it would take to “clear” the market – has fallen to 31.5 weeks, a 37% drop from the 50.2 weeks inventory level of June 2008.

“This combined drop in new listings and available inventory is a major turn-around from the stagnated market of six or nine months ago when property sales were at record low levels and the lack of buying interest meant available inventory had built up to over 52 weeks of average sales,” says Realestate.co.nz CEO Alistair Helm.

“Now, with sales volumes on the rise, but the stock of available properties reduced, we could find that after the traditional quiet winter period ends, the market becomes very active in spring,” Mr Helm says.

“It looks like by September this year we are likely to have a growing number of Spring home buyers chasing a falling number of properties on the market. If the downward trend in inventory continues, at some point this could lead to price pressure creeping back into some pockets of the market . This has to be the eventual outcome.”

“The long held fears that we might see a fall of up to 30% in house prices have proven to be unfounded. It is hard to predict, but I don’t see any immediate signs of prices dropping any further.

The full NZ Property Report can be found on Realestate.co.nz’s Unconditional blog at: www.realestate.co.nz/blog.

About Realestate.co.nz
Realestate.co.nz is the official website of the New Zealand real estate industry, and provides the most comprehensive selection of listings across all categories of real estate. Realestate.co.nz lists over 100,000 properties at any one time, representing over 90% of all listings currently marketed by real estate professionals.

ENDS

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