Numbers holding up well, says real estate boss

Media release
Century 21 New Zealand
Thursday, 13 July 2017

Numbers holding up well, says real estate boss

While the latest REINZ figures point to a steadying of Auckland house prices and a slowdown in total sales and the time it takes to sell, the overall outlook for real estate remains strong, says Geoff Barnett, National Manager of Century 21 New Zealand.

“When you seasonally adjust these numbers and compare them to one year ago not one month ago, they’re holding up really well. And let’s not forget that REINZ stated ‘at worst, prices in the Auckland region are steady at present’. Last year we heard a lot of doom and gloom from commentators about plummeting prices in 2017 and fast rising interest rates, but neither is nowhere near.”

Mr Barnett says New Zealand is now experiencing a return to a more normalised real estate market.

“Increasing housing supply and measures such as tougher loan-to-value ratios are delivering a nice and sustainable soft landing. Gone are the days of silly prices and quick sales. Instead we’re seeing buyers setting the price with vendors’ expectations slowly but surely getting more realistic.

“Auckland is still going well, even if time on market has moved out. While Waikato and the Central North Island, in particular, are also reporting a positive story. Yes, things have steadied up across the industry, but overall our Century 21 New Zealand group is still forecasting growth with more franchises to open this year.”

He says the upcoming General Election is probably not helping sales, but he’s confident that once the Government has settled in, real estate can expect a lift in activity in the last quarter of 2017 and the first quarter of next year.

“As well as relatively low interest rates, the country’s overall economic outlook and population growth is strong, and of course we’ve still got a shortage of housing. All in all, the conditions for an ongoing sustainable and stable real estate market remain in place.”

Mr Barnett agrees with REINZ’s observation that the major trading banks are being cautious with their approach to lending.

“Lately, we’ve seen a number of deals fall over solely due to finance, and others in the industry will tell you exactly the same. Many first-time buyers or those too highly leveraged seem to be struggling to secure a mortgage. It’s a shame for them, but it is the new reality.

“When you look at the sheer number of new housing developments, see the regions getting a real lift, while Auckland’s house prices become a bit more realistic, the overall real estate story in New Zealand remains a positive one. We mustn’t get overly analytical on monthly statistical movements,” says Mr Barnett.
www.century21.co.nz

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