Tony Alexander BNZ – REINZ Residential Market Survey – Sept

Tony Alexander BNZ – REINZ Residential Market Survey – September 2013

Our monthly survey of licensed real estate agents around New Zealand attracted a strong 418 responses this month but contained no good news for buyers. In fact a record proportion of agents see the current market as a seller’s one and investors are increasingly becoming the driving force. But first a red herring for buyers….

There has been a sharp jump in the number of agents seeing more people asking for appraisals which on the face of it suggests more listings soon. But buyers should contain their enthusiasm because the rise discussed below from 0% to 21% is entirely a seasonal change seen clearly during 2012 and 2011. Therefore one cannot conclude that the shortage of listings makings things so difficult for buyers is easing.

Interest from investors appears firm with this measure rising for the second month in a row to sit at above average levels of a net 26% positive versus a 17% average. However while agents say they are seeing more first home buyers in the market (a net 24% from 18% in August) this perception is below the net 34% average. Therefore when one takes into account the reduction in the ability of young buyers to make a purchase caused by the Reserve Bank’s new rules New Zealand appears increasingly headed down the same track as Australia where investors are becoming the key driving force in many markets (caused by discontent with low bank deposit rates) while first home buyers are being squeezed out.

With regard to price pressures the direction is seen as overwhelmingly upward. A net 51% of responding agents feel that prices are rising – a result consistent with all other months so far this year – and a record net 30% of agents feel that it is a seller’s market.

All the best
Tony Alexander
Chief Economist

ENDS

© Scoop Media