Property Prices See Largest Drop On Record
The national average asking price for a property saw a record-breaking drop in June, falling 3 per cent, or $24,550, in just four weeks, according to the latest Trade Me Property Price Index.
Trade Me Property Sales Director Gavin Lloyd said in June the average asking price for a property in New Zealand was $925,150. “The national average asking price has not been this low since October 2021, and this marks the second record-breaking price drop in a row following May’s 2 per cent month-on-month dip.
“After creeping closer to the $1 million mark over the past 12 months, we’re now seeing the national average asking price retreat, sitting significantly lower than the all-time high of $971,450 we saw in March.”
Taking a look around the regions, the largest average asking price drops were seen in the main centres. “In the Auckland region, the average asking price fell 4 per cent month-on-month, while the Wellington region was not far behind with a 3 per cent drop.”
Mr Lloyd said the only regions to buck the trend were Otago and Taranaki, which saw their average asking prices increase by 2 per cent and 1 per cent respectively when compared with May.
When compared with June 2021, Mr Lloyd said last month’s average asking price marked a 12 per cent increase. “While this is still a significant increase, it’s the smallest annual percentage jump we’ve seen since November 2020.
“Going forward we may see prices drop even further if supply remains high and demand is comparatively low, which will be music to the ears of those looking to buy around the country.”
Supply continues to soar
Mr Lloyd said a major factor behind these price drops was supply continuing to soar in June.
“Nationwide, supply was down slightly month-on-month (-3%) but skyrocketed by 52 per cent year-on-year, the largest percentage jump we have ever seen.
“With supply surging for three months in a row, buyers are no longer feeling the pressure and can afford to take their time, and look at their options.”
Looking around the country, Mr Lloyd said every region saw more properties for sale in June when compared with the same month last year. “The largest supply increases were seen in Wellington (up 93%), Hawke's Bay (up 90%), Bay of Plenty and Nelson/Tasman (both up 85%.)”
Nationwide demand also fell in June by 7 per cent year-on-year. “This saw the market cool off further and accelerated price drops.”
Wellington prices drop by 3 per cent
The Wellington region saw an average asking price of $936,300 last month. “While this marked a drop on May, it’s an 8 per cent increase when compared with the same month in 2021.”
Looking at Wellington City, Mr Lloyd said the district’s average asking price fell by 1 per cent month-on-month at $1,055,350 last month. “This puts it just behind the most expensive district in the region, South Wairarapa ($1,082,400), while Porirua was the third most expensive spot ($971,250).”
While supply surged in Wellington last month, demand in the region grew by just 1 per cent year-on-year.
The country’s most popular property in June was a two-bedroom, one-bathroom house on Wallace Street in Mount Cook. “The house was watchlisted 440 times in its first seven days onsite.”
Prices see a downturn in the Auckland region
In the Auckland region, last month's average asking price jumped 9 per cent when compared with June 2021. "This is the first month the region has seen a year-on-year increase below 10 per cent since March 2021."
The most expensive district in the Auckland region last month was Waiheke Island, sitting at $1,662,900. “The North Shore City district came in second, with an average asking price of $1,416,550 and was followed by Rodney ($1,324,900.”
Supply in the Auckland region was up 40 per cent year-on-year in June, while demand was down 14 per cent.
“Last month’s most popular property in the City of Sails was a four-bedroom, five-bathroom house on Hobson Street in the City Centre. It was watchlisted 418 times in its first seven days onsite.”