By Bernard Hickey
Realestate.co.nz's November report shows its number of new listings grew 9% to 12,932 in November, which was more than triple the number of properties sold in October. New listings growth was 7% in seasonally adjusted terms to their highest level since June 2008 and was the highest November since 2007.
There is now 53.2 weeks worth of unsold inventory on the housing market, up from 48.8 weeks in October and up from 47.5 weeks in September. It is also at its highest level since June 2008 and above the long term average of 39 weeks, indicating a 'buyers market', Realestate.co.nz said.
The truncated mean asking price for properties fell 1% from the previous month to NZ$417,660 and is now down 3% from the peak in prices in in October 2007.
Realestate.co.nz said the surge in November property listings showed vendor confidence picking up in spite of a slow market as they looked to take advantage of the fine summer weather. See interactive housing inventory chart.
“These figures are heartening because they indicate there is actually some new life in the market, which we haven’t seen in a long time,” said Alistair Helm, CEO of Realestate.co.nz.
“Vendors are eager to take advantage of the summer marketplace and are setting their expectations at realistic levels,” he said, adding the figures were a good sign for home buyers.
“While these indicators show it’s definitely a good time to buy, we’ll need to wait and see how this trends over the next few months before we can fully assume that the market is regaining some buoyancy.”
Here are more details from the report:
The comment from the October NZ Property Report was that “spring had past the property market by!” clearly the November market activity shows that “the best was saved til last!” The month saw a significant (and unseasonal lift) in new listings, in some ways making up for the somewhat quieter first 3 months of spring.
The monthly sales though have as yet failed to show any appreciable lift with October reported at 3,903, the lowest recorded total for October since record show back to 1992.
This low rate of sale (currently averaging 4,340 per month) is driving the inventory levels to highs not seen for over 2½ years with the equivalent of over a full year‟s worth of sales on the market. In some regions that total now exceeds 2 years (Central Otago& Wairarapa) and even over 3 years (Coromandel & Northland).
The November sales data is yet to be released but there does appear to be some significant pockets of activity which are driving sectors of the property market especially at the high end of price bands. These latest statistics in this report, which have been consistent for a number of months now, in regard to trends, all continue to point to a confident market, albeit a sluggish one.
Asking price expectation whilst showing some weakness this month, does not appear to be under excessive pressure, however price would seem to be the only factor able to bust the log jam of unsold inventory of houses on the market.
Whilst the national asking price expectation remained steady with just a small fall from prior month and a small increase over the recent 3 month average, the regional analysis shows some significant variances.
Amongst the 19 regions almost half showed a rise whilst the remained showed a fall. The three east coast regions of Gisborne, Hawkes Bay and Wairarapa all saw significant increases of more than 5%. The single largest fall in asking price expectation (-8.6%) was seen in the Coromandel region which when combined with the rise in new listings may well reflect some significant re-pricing of existing listings which may be required to clear the inventory which now amounts to 262 weeks of equivalent sales.
The Coromandel region already challenged by a very high level of inventory saw a total of 349 new listings in the month up 35% of the prior year. All three of the major metro regions showed steady increase in asking price expectation.