Optimism Continues In The Lifestyle Sector

Data released today by the Real Estate Institute of New Zealand (REINZ) shows there were 302 less lifestyle property sales (-10.9%) for the three months ended February 2021 than for the three months ended January 2021. Overall, there were 2,471 lifestyle property sales in the three months ended February 2021, compared to 1,769 lifestyle property sales for the three months ended February 2020 (+39.7%), and 2,773 lifestyle property sales for the three months ended January 2021.

9,244 lifestyle properties were sold in the year to February 2021, 1,992 (27.5%) more than were sold in the year to February 2020. The value of lifestyle properties sold was $8.77 billion for the year to February 2021.

The median price for all lifestyle properties sold in the three months to February 2021 was $845,000 and was $135,000 higher compared to the three months ended February 2020 (+19.0%).

Brian Peacocke, Rural Spokesman, at REINZ says: “Sales figures for the 3 month period ending February 2021 reflect an easing trend from the previous period ending January 2021, but nevertheless, on a month by month basis, February sales were 32% ahead of the figures for the previous month of January.

“Again, acknowledging February sales alone, all regions apart from one achieved an increase in sales, albeit quite small in some cases.

“Market conditions remain strong, listings in many areas are constrained and timeframe for achieving a sale is reducing.

“Given the current level of interest rates and the consistency in the median price, the outlook for the sector at this stage is extremely positive,” he concludes.

Points of Interest around New Zealand include:

• Upper North Island - Good recovery in sales numbers for February compared to the previous month although not to the level of the recent peak in November 2020. Rodney remains the dominant district in the lower north by a significant margin. The median price increased marginally throughout the region
• Central Regions - Waikato volumes increased 53% from last month with activity in the Waikato District double that for Waipa; Bay of Plenty recovered strongly from January figures with Western Bay of Plenty easily dominating in the numbers game; Gisborne and Hawke’s Bay remained flat whereas Taranaki bounced back vigorously from last month to be on par with the 3 month period preceding Christmas last; median prices slipped back in the Waikato, improved in the Bay of Plenty, dropped 21% in Gisborne and 8% in both Hawke’s Bay and Taranaki so volatility is clearly a factor
• Southern North Island - Manawatu/Wanganui was the only region to record a drop in sales volumes, equating to a reduction of 18%, whereas Wairarapa & Wellington recovered a full 100% gain from the major reduction the area experienced in the previous month of January 2021; both regions benefitted from minor gains in the median price
• Upper South Island - In keeping with its northern neighbours, Nelson/Marlborough enjoyed a 54% increase in sales volumes to place themselves back amongst pre-Christmas levels of activity, albeit at the expense of a small downward adjustment in the median price; West Coast doubled their January performance and in so doing, boosted their median price by a healthy 24%; Canterbury held on for par in both sales numbers and price with all districts contributing at levels consistent with the previous month, albeit well below the peak achieved in August 2020
• Lower South Island - Otago sales jumped 50% from last month with activity centred primarily in the Central/ Queenstown/Lakes districts and in so doing, gained incrementally in value; in keeping with the southern trend, Southland recovered 100% in volume compared to January but still remained behind the sales numbers achieved during the late spring of 2020; unfortunately for Southland, the median price for the month dropped 14.5% ($470,000 in February 2021 vs $550,000 in January 2021)

Eleven of the fourteen regions recorded an increase in sales compared to February 2020 with Auckland (+195 sales) and Canterbury (+137 sales) observing the biggest increases. Wellington recorded the largest decrease in sales (-7 sales) in the three months to February 2021 compared to the three months to February 2020. Compared to the three months to January 2021, one region (West Coast) recorded an increase in sales.

All fourteen regions saw the median price of lifestyle blocks increase between the three months ending February 2020 and the three months ending February 2021. The most notable examples were in Otago (+45%), Gisborne (+39%) and Bay of Plenty (+33%) with the smallest increase being in Auckland (+6%).

The median number of days to sell for lifestyle properties was twelve days less in the three months to February 2021 than in the three months to February 2020, sitting at 53 days. Compared to the three months ended January 2021 the median number of days to sell was four days longer. Manawatu/Wanganui recorded the shortest number of days to sell in February 2021 at 36 days, followed by Wellington (40 days). West Coast recorded the longest number of days to sell at 101 days, followed by Northland and Gisborne at 65 days.

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