Winter Chills Impact the Market

Data released today by the Real Estate Institute of New Zealand (REINZ) shows there were 112 less lifestyle property sales (-5.6%) for the three months ended July 2018 than for the three months ended June 2018. Overall, there were 1,883 lifestyle property sales in the three months ended July 2018, compared to 1,984 lifestyle property sales for the three months ended July 2017 (-5.1%) and 1,995 lifestyle property sales for the three months ended June 2018.

7,251 lifestyle properties were sold in the year to July 2018, 1,013 (-12.3%) fewer than were sold in the year to July 2017. The value of lifestyle properties sold was $5.86 billion for the year to July 2018.

The median price for all lifestyle properties sold in the three months to July 2018 was $660,00 and was $80,000 higher compared to the three months ended July 2017 (+13.8%).

Brian Peacocke, Rural Spokesman, at REINZ says: “Whilst it is expected total sales volumes will ease in the mid-winter period, of particular note is the steady reduction in total sales for the month of July 2018 to a level similar to that of 3 years ago.

“The corresponding figure balancing the equation is the median price which has increased dramatically from $525,000 for the equivalent period 3 years ago to $660,000 for the most recent period ending July 2018.

“Such price levels reflect a sector experiencing good health, but also a shortage of stock. The test will be the sustainability of the median price as the availability of property increases in due course, but certainly to date, the median price is showing a steady and inexorable increase over the recent years,” he concludes.

Points of General Interest around New Zealand include:

• Slight increases in sales volumes for the month of July 2018 in the Auckland, Bay of Plenty, Gisborne, West Coast, Otago and Southland regions
• Central Otago and the Queenstown Lakes District continue to impress with the number of high-priced sales, as is consistently the case within the Auckland region
• Decreases in sales volumes during the month of July 2018 have been noted in the Northland, Waikato, Hawke’s Bay, Taranaki, Manawatu/Wanganui, Wellington, Nelson/Marlborough and Canterbury districts

• Demand for quality property remains high in all regions throughout the country.

Five regions recorded an increase in sales compared to July 2017. Bay of Plenty recorded the most substantial increase in sales (+18 sales) in the three months to July 2018 compared to July 2017. Compared to June 2018, five regions recorded an increase in sales.

All but three of the regions saw the median price of lifestyle blocks increase between the three months ending July 2017 and the three months ending July 2018. The most notable examples were in Otago (+47%), West Coast (+43%) and Wellington (+31%) and the exceptions were Gisborne (-7%), Taranaki (-5%) and Nelson (-3%).

The median number of days to sell for lifestyle properties was two days longer in the three months to July 2018 as in the three months to July 2017, sitting at 63 days. Compared to the three months ended June 2018 the median number of days to sell was three days longer. Manawatu/Wanganui recorded the shortest number of days to sell in July 2018 at 47 days, followed by Taranaki (50 days), Bay of Plenty (52 days) and Gisborne and Hawke’s Bay (55 days). West Coast recorded the longest number of days to sell at 160 days, followed by Southland at 84 days and Auckland at 78 days.

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