Volatility Continues

Data released today by the Real Estate Institute of New Zealand (REINZ) shows there were 185 fewer lifestyle property sales (-10.1%) for the three months ended September 2021 than for the three months ended August 2021. Overall, there were 1,650lifestyle property sales in the three months ended September 2021, compared to 2,720lifestyle property sales for the three months ended September 2020 (-39.3%), and 1,835 lifestyle property sales for the three months ended August 2021.

9,464lifestyle properties were sold in the year to September 2021, 1,800 (+23.5%) more than were sold in the year to September 2020. The value of lifestyle properties sold was $10.26 billion for the year to September 2021.

The median price for all lifestyle properties sold in the three months to September 2021 was $950,000 and was $195,000 higher compared to the three months ended September 2020 (+25.8%). The median price for Bare land Lifestyle properties sold in the three months to September 2021 was $490,000 and was $90,000 higher compared to the three months ended September 2020 (+22.5%). The median price for Farmlet Lifestyle properties sold in the three months to September 2021 was $1,201,112 and was $291,112 higher compared to the three months ended September 2020 (+32.0%).

Brian Peacocke, Rural Spokesman, at REINZ says: “The sales volumes for lifestyle properties for the three-month period ending September 2021 reflect a 10% reduction from the figures for August 2021. But more significantly, close to a 40% drop from the equivalent period 12 months ago, to place the 2021 figures at a level very similar to the figures for September 2019.

“Why the drop? Perhaps partly because of the COVID-19 pandemic, partly because of the shortage of stock, and possibly partly because of anticipation of interest rates and debt reduction requirements from the banking sector being likely to increase in the foreseeable future.

“Whatever the case, the market is the market – conjecture as to the reasons why and the causes for changes in the market is simply that, conjecture. Crystal ball gazing is an art practised by many but perfected by few.

“Of equal significance, however, is that the national median price has increased from $940,000 last month to $950,000 for the period ending September 2021.

“Significance? Supply and demand seem a reasonably logical response – relevance? Debatable,” he concludes.

Points of Interest around the country for the month of September 2021 include:

• Upper North

Lifestyle sales volumes in Northland were well spread but are 10% lower than in September 2019 and 25% down on the sales volumes in 2020. Median price has lifted 13.7% from last month

Auckland sales volumes have plummeted from 175 for September 2020 to 55 for September 2021 – a drop of approximately 70%, whilst median price at $1.3m has dropped 23.5% from last month.

• Central North Island

Waikato results have improved from last month and at 80 sales for September are beating the trend. Nevertheless, whilst being close to par with sales in September 2019, the volumes are approximately 57% lower than 12 months ago. Median price has eased to a minor degree

Bay of Plenty/Rotorua sales results are slightly better than two years ago but have dropped a significant 44% from September 2020. Median price for the 12 month period has eased 15% to $1.1m

Gisborne/Hawkes Bay reflects a similar trend but is still down 42% on last year - median price has improved by 23%

Taranaki sales volumes have held par with two years ago but have dropped close to 45% in the last 12 months – median price has eased from $666,000 last month to $585,000 this month.

• Lower North Island

Manawatu/Wanganui has had a severe belt tightener from 12 months ago (2021 – 38 sales; 2020 – 81 sales; 2019 – 49 sales) with an easing of 7.5% in the median price

Wairarapa/Wellington volumes are well ahead of 2019 but down 37% from 2020, that result being exacerbated by an easing in the median price.

• Upper South Island

Sales activity caved in this month in the Nelson / Marlborough region (11 sales versus 29 sales in 2020) but experienced a good lift, in excess of 30%, in the median price

Canterbury results were close to par with those for two years ago, but slumped by close to 44% from last year – medium price lifted by 10.8% from $740,000 last month to $820,000 this month

West Coast with 15 sales for September dropped 30% from the equivalent 2020 figure but was well ahead of 2019; median price eased from $390,000 in August to $320,000 on September 2021.

• Lower South

Otago, the lifestyle jewel of the lower South, eased 16% in sales volumes from 2020 but was 50% ahead of the comparable period in 2019; however, the median price for September 2021 was completely kicked for touch with a massive drop of close to 38%, perhaps reflecting the lack of traffic from Auckland

Southland, forever the stalwart, suffered similar symptoms to their northern neighbour with a 46% drop in sales volumes compared to September 2020, and a 33% drop from September 2019; median price compensated to a degree with a lift from $552,500 to $641,500 - a healthy increase of 16%.

Noregions recorded an increase in sales compared to September 2020, with West Coast (-13 sales) and Southland (-34 sales) observing the smallest decreases. Waikato ( -228 sales) and Auckland (-216 sales) recorded the biggest decreases in sales in the three months to September 2021 compared to the three months to September 2020. Compared to the three months to August 2021, 1 region recorded an increase in sales.

13regions saw the median price of lifestyle blocks increase between the three months ending September 2020 and the three months ending September 2021. The most notable examples were in Gisborne/Hawkes Bay (+73.9%) and Wellington (+59.4%) with the smallest increases being in Canterbury (+6.8%) and Northland (+13.8%).

The median number of days to sell for lifestyle properties was 19 days less in the three months to September 2021 than in the three months to September 2020, sitting at 49 days. Taranaki (32) and Waikato (41) recorded the shortest number of days to sell in September 2021. Southland (80) and West Coast (76) recorded the longest number of days to sell.

© Scoop Media