REINZ numbers show the housing market is weak but prices may be stabilising after almost a year of falls

Property / news

Housing sales are low for the time of year but the national median price edged up in October

15th Nov 22, 9:00am by Greg Ninness

The housing market was extremely weak in October although there are signs prices may have started to stabilise.

The Real Estate Institute of New Zealand (REINZ) recorded 4892 residential sales throughout the country in October, down 35% compared to October last year and down 31% compared to October 2019 before the Covid pandemic disrupted the market.

Perhaps even more significant was the fact that sales declined in October compared to September (-4.3%) which is unusual because sales are usually on a strong upward trajectory in October.

However there are signs the recent falls in house prices may be starting to abate.

The national median house price was $825,000 in October, down 7.5% compared to October last year but up 1.9% compared to September this year.

The REINZ's House Price Index, which adjusts for differences in the mix of properties sold each month and is regarded as the most reliable indicator of house price movements, was down 10.9% compared to October last year and down 12.4% compared to its November 2021 peak, but up a marginal 0.2% compared to September this year.

The trend of weaker sales volumes but firmer prices in October was particularly noticeable in Auckland, where sales numbers were down 8.2% compared to September but the median price was up 5% for the same period.

For the rest of the country excluding Auckland sales volumes in October fell 2.4% compared to September, while the median price was down 1.5% for the month.

The interactive charts below show the monthly trends in median prices and sales volumes for all regions of NZ.

"This year several compounding factors have created uncertainty and hesitancy in the market where there was confidence and urgency last year," REINZ Chief Executive Jen Baird said.

"Rising interest rates and the cost of living, tax legislation and property regulation, tightened lending criteria and global events with macro-economic impacts.

"We see downward pressure on prices and the pace of the market has come down.

"However over the last couple of months, salespeople have observed an increase in enquiries and a noticeable increase in the number of first home buyers back in the market.

"Properties continue to change hands and people continue to make life decisions.

"However buyers and vendors are acting with caution, weighing up their options," she said.

The comment stream on this article is now closed.

Volumes sold - REINZ

Select chart tabs

Source: REINZ

Median price - REINZ

Select chart tabs

Source: REINZ

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154 Comments

by Future | 15th Nov 22, 9:05am 1668456352

It's going to get a lot worse before it gets any better. Higher Interest Rates will Not stabilise anything !

by Miguel | 15th Nov 22, 9:10am 1668456629

I suspect this slight pause in the trajectory in falling prices is directly related to the brief dip in fixed rates. Rates have since all gone notably higher, which will likely be reflected in the coming months figures.

by tuisbest | 15th Nov 22, 9:48am 1668458897

Hi Miguel, have you been able to update, or do you plan to update those immensely interesting graphs you've previously posted to show how NZ's current trajectory compares to other housing market crashes? (I sincerely hope you didn't get into trouble for posting those here.)

by Miguel | 15th Nov 22, 2:49pm 1668476991

I can’t update/post them from my phone, but will if I remember next time I’m at a desktop

I haven’t bothered to update the graph as it wasn’t designed to provide monthly updates. It designed to show the correction to date and put it in context of other corrections, and it doesn’t really show any new information month to month.

by tuisbest | 15th Nov 22, 10:25pm 1668504303

Thanks. I was hoping it might be easy to update, but no worries. I think we've all (OK, maybe not TTP) appreciated that you shared those graphs here. Really put this supposed non-crash into perspective.

by tothepoint | 15th Nov 22, 1:18pm 1668471488

Unsurprisingly, there's increasing speculation from well-informed individuals that house prices will find a footing before much longer. Mortgage interest rates may well be near their peak.

The current downswing in the housing market is not nearly as sinister as some here would have us believe....... 2022 may well go down in history as the year of the "short and shallow" correction. ✅

TTP

by Brock Landers | 15th Nov 22, 1:19pm 1668471567

Deepest correction in living memory.

by Future | 15th Nov 22, 2:13pm 1668474831

TTP Tim Mordaunt has a Deal for You !

Pay the Price of 2 Sections Now and get 1 when the Title comes through late next Year.

Lock in Today's Spruikers Price and Lose 50% in 12 Months time for settlement.

And Remember Boys and Girls - If you Don't Buy Now You Will NEVER Own A Home !!!

Only while stocks Last, ( batteries not included ).

https://www.trademe.co.nz/a/property/residential/sections-for-sale/hawkes-bay/hastings/havelock-north/listing/3720468537

by General Comment | 15th Nov 22, 4:03pm 1668481388

I do like a good bargain. Is there a limit? Can I get 2 for the price of 4?

by Independent_Observer | 15th Nov 22, 2:27pm 1668475657

"Unsurprisingly, there's increasing speculation from well-informed individuals that house prices will find a footing before much longer. Mortgage interest rates may well be near their peak"

Key word here is speculation - it was speculation with debt against house prices that got us into this financial and social instability problem/hole there TTP!

We don't need any further speculation with respect to house prices please.....an average couple should be able to buy the average home for their own without the fear of either missiong out (FOMO) or fear of being financial ruined if they pay too much and get riddled with a huge mortgage and rising interest rate payments they can't afford.

by Slapheid | 15th Nov 22, 3:15pm 1668478540

increasing speculation from well-informed individuals

Brilliantly vauge! Trying to grasp any meaningful information from your prose is like punching smoke. Well played Tim!

by Future | 15th Nov 22, 3:41pm 1668480077

TTP is the nothing more than Smoke and Mirrors .

by Gummy Bear Hero | 15th Nov 22, 1:06pm 1668470816

... indeed ... house prices continue to plummet ... its the biggest fall since records began ... a reversal of the biggest rise ever , when the RB juiced the system ...

Momentum & interest rate directions will not reverse any time soon ...

... the RBNZ cocked up ; Robbo cocked up : now we're witnessing the afternath of what they created ...

by Rumpole | 15th Nov 22, 2:45pm 1668476742

Graph trends are down, interest rate trends up so will the trend reverse - no chance,

by Yvil | 15th Nov 22, 9:05am 1668456356

If anyone has received a payout from Southern Response (former AMI) for having lost their house in the Chch earthquake, make contact with them asap. There has been a court case won by the Dodds family a while ago, this means SR needs to pay professional fees, a 10% contingency sum and interest for over 10 years. I have just received a six figure sum from them yesterday, it sounds too good to be true but it's real. SR will even pay $2'000 towards your legal fee if you want to get a lawyer to check things.

by Future | 15th Nov 22, 9:10am 1668456617

"I have just received a six figure sum from them yesterday," And a million Dollars for cutting down some trees.

by Yvil | 15th Nov 22, 9:36am 1668458163

So that's all you take from my post trying to help people? It's very clear that it really irks you when others get something you don't have. That's not a good attitude in life, do the best you can, look on the bright side and be happy in the Future.

by Future | 15th Nov 22, 9:59am 1668459592

Oh No Yvil, It's Marvellous you have Made a Million Bucks from chopping down those trees. And your timing is Impeccable, e.g. bought and sold out of your area in Thames and perfectly smashed the market, maybe the same in Christchurch also. Had Motels that got Top dollar from the Government's Emergency Housing Programme. You even managed it yourself with those difficult people. The Humble Character and skills needed for such a feat is truly breathtaking.

But there is always something in my gut feeling I just can't work out - It's the way you get so defensive and insecure about other people's comments, something as small as making fun of your name, and you get all upset. It just does not seem to line up with the Character Traits needed for those achievements, especially managing all those people.

by Yvil | 15th Nov 22, 10:31am 1668461509

The feeling in your gut you can't work out, is envy of others. Just re-read your post above, full of sarcasm and cynicism. That's not good, Future, that only prevents you from getting ahead yourself.

by Future | 15th Nov 22, 11:06am 1668463592

It's good to have a little fun Yvil. I know you may be getting a little stressed with Interest Rates going to 10% and all, but let your hair down and have a laugh. I have found the perfect place for you to move to once you are happy again.

HappYvil

https://www.youtube.com/watch?v=iVBIzFjawOc

by Yvil | 15th Nov 22, 2:36pm 1668476214

Future, you typically do this when you loose an argument, you take the piss in order to change the subject and post a silly youtube video. This is really immature and childish. Of course you can spend your whole life hiding behind sarcasm so you don't ever have to be real, you can continue being cynical about everything and everyone and ridicule others to make yourself feel better, but is it really the life you want ?

by Future | 15th Nov 22, 2:45pm 1668476757

OK Yvil. No more jokes, time to be serious.

10% Interest Rates Next Year, Guaranteed !

by Yvil | 15th Nov 22, 4:43pm 1668483828

Well you did very well predicting 7% interest rates by December 2022, when most of us, me included, didn't believe it, so well done on this prediction!

by Future | 15th Nov 22, 5:00pm 1668484850

The Prophet would be pleased with your comment. 7% Interest Rates This Year, Guaranteed !

I wonder if HouseMouse will do the same ?

by Yvil | 15th Nov 22, 6:42pm 1668490946

I wonder if you will do the same come January, if the 30% drop in house prices across NZ doesn't eventuate for December?

by Chairman Moa | 15th Nov 22, 11:52am 1668466369

Nominations are opened for New Year's awards, would you like us to nominate you for knighthood?

We all can write a long essay and I am sure Jacinda will read it favourably on her flight back from Bali.

Let us know please.

by HouseMouse | 15th Nov 22, 12:49pm 1668469741

It was just an excuse for him to have another skite.

by rastus1 | 15th Nov 22, 9:19am 1668457184

Souther Response - is that the outfit that us taxpayers generously set up because the Dodds family and others went for the cheapest insurer who then went bust?

So, I guess as a gesture of thanks to us taxpayers they want even more from us. Or have I got it wrong?

by redcows1 | 15th Nov 22, 9:24am 1668457498

No, not wrong. That's exactly how it happened

by bw | 15th Nov 22, 9:33am 1668458009

Exactly.

Another case of socialise the losses. Right up there with the South Canterbury Finance decision.

by HouseMouse | 15th Nov 22, 10:19am 1668460778

And yet Southerners think Auckland is a big drain on the country, lol

by RickStrauss | 15th Nov 22, 10:21am 1668460907

Can't be right. It'll be folk who did everything on their own two feet, including receiving taxpayer-funded university education, affordable housing thanks to previous generations' taxes etc. It's only fair that taxpayers give them more money after they chose poorly on insurance or investments. That's just doing it on one's own two feet.

It's not evil socialism; that's when money goes to the poors.

by Nzdan | 15th Nov 22, 2:27pm 1668475651

They got all that from the previous generation's taxes, which at the time the top tax bracket was 60% - 70%. Once they got through University and started their careers, the top tax rate was axed to 33% (in 1988).

by RickStrauss | 15th Nov 22, 3:09pm 1668478199

Cut a few things for the young...not the universal pension benefit for themselves though, obviously. Which is slightly incongruous, as it was instituted as part of that earlier reciprocal model.

by Nzdan | 15th Nov 22, 6:26pm 1668489991

So now we have a $16b p.a. universal pension spend, but cannot find less than $1b per year to abolish student loans at the current loan draw down rate.

by Chaosinflesh | 15th Nov 22, 8:45pm 1668498349

Well, if the oldies UBI were means tested, we certainly could. I.e., my wife's olds who are both still working full time and both drawing super. All that happens is they pay secondary tax on the super.

by Nzdan | 16th Nov 22, 1:13pm 1668557599

Meanwhile potentially road blocking a bunch of career advancement opportunities for those down the ranks, depending on what sort of role they're in.

Either you're retired or you're not, just like you're either unemployed or you're not.

by interesting1234 | 16th Nov 22, 9:21am 1668543716

Prime example of why if more of the younger generations voted for what suits them best, then the overall voting power would be greater than the baby boomers who, by in large are more actively engaged in politics and likely to vote. Time to vote for a different generation to benefit or next thing you know the pension spend will blow out even further

by RickStrauss | 17th Nov 22, 9:57am 1668632260

Meanwhile, we fork out $3 billion per year to subsidise landlords.

Entitlement all over.

by Yvil | 15th Nov 22, 9:33am 1668458008

Rastus, "is that the outfit that us taxpayers generously set up" "have I got it wrong?"

Yes you have got it wrong, you didn't setup anything, also by your many envious, cynical posts, it is very clear that generosity is not an attribute you have.

by bw | 15th Nov 22, 9:48am 1668458918

What has Southern Response cost taxpayers so far? Half a billion bucks?

Whatever the number, that's taxpayer money that could have been applied elsewhere in the economy - schools, police, hospitals etc.

Was it the fault of those who insured with AMI that they chose the weakest option for their cover. No.

But that was for the wider insurance sector to sort out, not the taxpayer. If insurers wanted to maintain confidence in their product, then they had the option to make-good, it shouldn't have been flicked off to the taxpayer.

The fact that AMI is still operating today as part of IAG tells us that a commercial solution was possible.

by Yvil | 15th Nov 22, 10:34am 1668461669

How has the original post, which is trying to help someone else who might be in my position, turned to so much negativity… It's very sad really.

by Retired-Poppy | 15th Nov 22, 11:23am 1668464625

"How has the original post, which is trying to help someone else who might be in my position, turned to so much negativity… It's very sad really"

Yvil, you knew it would, that's why you posted it in the first place. This pursuit of yours is very sad really"

Yvil, bored.

by lastlegs | 15th Nov 22, 11:28am 1668464929

yes,definitely a windup and they took the bait.

by Retired-Poppy | 15th Nov 22, 11:39am 1668465561

Classic attention seeking behavior. Its very childish.

by Slapheid | 15th Nov 22, 12:35pm 1668468925

It may come down to which side of the wealth transfer equation you sit on, whether the Southern Response situation fills you with positive or negative emotions..

by Yvil | 15th Nov 22, 2:29pm 1668475788

Slapheid, thanks for offering a reasonable argument amongst all the petty posts. I agree you make a good point!

But there is another point, being that home owners who lost their house in the Chch EQ have been short changed by the insurance company, which now has to make up for not paying what they should have in the first place. This is not an opinion, this has been established in the courts.

by Baywatch | 15th Nov 22, 2:52pm 1668477132

South Canterbury Finance - 1 billion dollars......

by rastus1 | 15th Nov 22, 12:11pm 1668467485

Okay... so set up by politicians using my tax money. Does that meet your audit?

Inspite of taxpayer generosity, these people are wanting even more of my tax when there was zero obligation to give them 1 cent?

They received charity from fellow taxpayers and have the cheek to demand more.

Disgraceful.

by RickStrauss | 15th Nov 22, 2:10pm 1668474605

Always have the hand out...

by DoneBizz | 15th Nov 22, 9:08am 1668456538

It really all depends on the banks now, hard to get finance for most. Long may it last. We have sensible interest rates and LVRs, DTI on the way. Specuvesters look over there at the bitcoin going cheap!

by Advisor | 15th Nov 22, 10:44am 1668462249

I expect "market intervention" from the government to protect the oversized vested interest in property... oops, I mean mom-and-pop investments.

Banks, construction companies, tradies, real estate agencies, landlords & speculators, household goods retailers - the riches of so many in NZ are tied to ever-increasing levels of housing activity.

In comparison, how material is the productive economy in terms of number of votes? Those workers and enterprises will do what others before them have done, i.e., move to an offshore location where they are better valued. Our system will fill the economic void with more speculation, low-value businesses and workers from overseas.

Look at the 180 from the government on mass migration. That is fate of most policy/economic reform in NZ - well-intentioned policymakers propose, lobbies dispose.

by OldSkoolEconomics | 15th Nov 22, 2:41pm 1668476464

Nah - nothing they can do that wont get up the RBNZ nose. The whole point is to STOP people spending money and tame inflation.

Any rescue of people that are hurting will result in continued spending, more people investing in housing (on the basis they will always be bailed out), untimately a bigger bubble and higher and higher OCR. It would be like Jacinda is pumping and trying to sitck plasters on a massive bubble that the RBNZ just keeps sticking bigger pins into....

The only question would be how delayed and huge the bang would be.

IF you are leveraged, or bought a house in the last few years and might struggle if you lose your job (in a recession), or if interest rates climb past 8%... and looking for a way out, stop spending, if you are an employer then stop hiking wages, deleverage your position as fast as possible (even at a loss) and encourage others to do so..... there is no plan B that will save house markets when inflation is out of control (the whole point is to raise payments for all, grow unemployment and deflate house prices).

by Independent_Observer | 15th Nov 22, 2:42pm 1668476547

Agree - intervention will make the problem worse.

To tame inflation we need to reduce fiscal spending - not increase it even further!

by Carinaz | 15th Nov 22, 9:16am 1668457012

So another 10% fall in next two year will be between 25% to 30% as per Westpac

https://i.stuff.co.nz/business/130471793/house-prices-expected-to-drop-…

In Auckland as fall in value in houses is more in 1.2 Million and above houses than in houses near million, many FHB are stretching as finding better deal by stretching and also partly because many FHB have still not come out of FOMO completely and FOMO is still a strong emotion in taking risk.

by Retail shop | 15th Nov 22, 9:29am 1668457799

Try saying that with your mouth full!

by Cur8or | 15th Nov 22, 9:30am 1668457806

See? House prices only ever go up. Buy now!!

by taimaiakka0 | 15th Nov 22, 9:42am 1668458549

Have noticed that house alien is falling in steps - though house price fall started in January/February but felt some fall after denial in April/May than it flatten before seeing another fall in August/September.

Now the next step - fall should be in December near around.

Currently all houses that would have been expecting during boom between 1.3 Million to 1.5 million+ have stopped at asking of 1.150 million to to 1.250 million, some are selling but many are not, so is wait and watch for next leg as could be meaningful and next RBNZ meeting could be catalyst.

by fortunr | 15th Nov 22, 9:44am 1668458696

LOL. Is anybody still believing a single word of what real estate agents are saying ?

by interesting1234 | 15th Nov 22, 11:08am 1668463685

They seem to spring "we need offers in by no later than (insert date for 2 days after viewing here)" on you, then seem surprised when you never get back to them.

by Llama_360 | 15th Nov 22, 9:45am 1668458755

We are looking to buy in Whangarei. Seems to us that there is a lot of lower quartile properties which have not sold for months and which the vendors refuse to budge significantly on price (but starting to see a few drops).

We recently went to one auction for a very unique waterfront property that we hoped we might snatch for a bargain as the vendors needed to move to a retirement home. There were not many people at the open home and not many people at the auction. However, two of the older couples who attended the auction got into a bit of a bidding war and it ended up going for $1.16 (CV was $1.125, valuation date 01-07-2021).

Seems like there are still quite a few cashed up buyers who are willing to shell out for something they really like. However, vendors who are looking for purchasers relying on lending will struggle as rates continue to rise.

by Future | 15th Nov 22, 10:12am 1668460352

"We recently went to one auction for a very unique waterfront property that we hoped we might snatch for a bargain as the vendors needed to move to a retirement home."

The Prophet would always say - There is No such thing as a Bargain in a Falling Market !

Just wait wait wait and ye shall be rewarded.

Beach Homes will soon be Offloaded !

by Llama_360 | 15th Nov 22, 11:27am 1668464832

Yes, my preference is to wait for at least a year. But my partner wants to settle in to our own place which is understandable. I'm happy to buy now even though I expect prices to continue to drop but only if we are one of the sales that lead the drop in statistics in a significant way :)

by interesting1234 | 15th Nov 22, 12:16pm 1668467813

And rezoned rendering them unable to get insurance

by Eschaton | 15th Nov 22, 10:24am 1668461067

Same in South Auckland. In fact, there are some decent bargains but FHB from other areas just won't buy in certain suburbs. Some vendors wont be able to sell.

by Der_Golem | 15th Nov 22, 9:47am 1668458869

I wonder how much of the slowing decline is the usual seasonal obsession of people wanting to get things done by Christmas - and what will the new year look like? I also wonder what the effect of the high number of lower interest, fixed-rate mortgages coming off over the next year might be, given interest rates don't look to be going down.

by tomjones_04 | 15th Nov 22, 9:49am 1668458990

Can we call it a crash yet? I love the levels of denial out there….buying an investment property now, makes no sense!

by RWC | 15th Nov 22, 9:51am 1668459095

Stabilising because month on month is up??? Not so sure...

Looking at sales volume which is a horrific -40% y/y and REINZ comments suggesting October was predominantly owner occupier activity - i'd say median price is simply a reflection of higher quality sales mix. Folks who own a decent house, have little bit of excess equity and can afford the higher rates are trading up in a declining market - doesn't mean stabilising...

Marginal buyers, such as FHB's, investors/developers simply cannot afford this market when mortgages soon enough, after RBNZ hikes next week (50 or 75bp), are likely to have a 7 in front... Inventory is rapidly climbing, and looking at the amount of auctions being passed, vendor's will need to swallow a very bitter pill. They will ask themselves. do I take today's 5-10% below RV offer, or wait few months and potentially be looking at offers 20% below. This has gone from a FOMO (fear of missing out) market, and is quickly turning into a "FONGO" (fear of not getting out) situation.

I do think house prices have to decline lower vs pre-pandemic levels. All the important housing drivers (i.e. immigration, funding costs, wages, construction, sentiment) are bad and getting worse.

Buckle up...

by BigBen | 15th Nov 22, 10:30am 1668461411

Marginal buyers, such as FHB's, investors/developers simply cannot afford this market

Except FHB have increased their market share..

https://www.corelogic.co.nz/news-research/news/2022/nz-first-home-buyer…

by HouseMouse | 15th Nov 22, 10:41am 1668462066

Yeah but based on a small number of transactions. Yes proportionately FHB activity has increased but not in terms of numbers. It’s simply reflective of property investor demand falling off the cliff.

by BigBen | 15th Nov 22, 11:58am 1668466695

Sure, but RWC's argument is that the current median price is a reflection of higher quality sales mix. If FHB's are taking a bigger share (regardless of transaction numbers), how can this be the case?

by HouseMouse | 15th Nov 22, 12:52pm 1668469976

Just speculating, but many potential FHBs on middle incomes will be struggling to buy in this market.

Perhaps FHBs who are active in the market are currently weighted more towards higher earning households ie. households with incomes of 200-300k, and who can afford properties in the $1.2 - $1.5 million range.

by BigBen | 15th Nov 22, 1:45pm 1668473130

Yeah perhaps. But then Auckland’s HPI is slightly up, I thought this measure takes into account different property types.

I notice the report has North Shore values down 18% for the year, I also thought this was guaranteed to be 30% by year end. Time will tell I guess.

by HouseMouse | 15th Nov 22, 2:15pm 1668474916

‘Future’ has been spouting nonsense about North Shore being down 28%.

by Future | 15th Nov 22, 2:58pm 1668477483

If you don't Agree with the information HouseMouse then I suggest you have a little talk with the Real Estate Institute .

Within Auckland, six of the seven territorial authorities had annual price decreases, with the North Shore’s the largest at 28.6% (to $949,000).

Prices were down annually in seven of the region’s eight territorial authorities, but South Wairarapa’s dropped the most with a 27.5% fall (to $700,000).

https://www.stuff.co.nz/life-style/homed/real-estate/130137138/house-prices-inch-up-between-august-and-september-real-estate-institute-data-shows

Nonsense Looks Like This.

by HouseMouse | 11th Oct 22, 4:26pm

It’s getting very boring.

I long ago admitted I was wrong on interest rates.

And Btw there’s no chances fixed rates will get to 7% before Xmas. They almost certainly won’t get there next year either.

by HouseMouse | 15th Nov 22, 3:38pm 1668479888

I notice you are very selective in the data you select to support your ‘prophecies’. That sounds typical for a religion or cult!

It is widely acknowledged that the HPI measure is superior to the median price measure. On the basis of the HPI measure, prices are not anywhere near 28% lower on the North Shore.

Note - I don’t live on the Shore, I have absolutely no vested interest in it or what happens to prices there.

by Future | 15th Nov 22, 3:51pm 1668480717

Your jealousy of The Prophet is making your data very selective HouseMouse.

You still don't believe Interest Rates have gone to 7% either.

Like I said, if you don't believe the numbers then have a moan to the Real Estate Institute .

by HouseMouse | 15th Nov 22, 5:04pm 1668485078

You post some good stuff but also plenty of nonsense. But I guess prophets are like that. Some wisdom emanates from them but also garbage.

You seem obsessed with the North Shore stats. So let’s have a closer look.

According to the REINZ report released today, the median house price for North Shore is down 18% between October ‘21 and October ‘22. And it’s actually up 26% between September ‘22 and October ‘22! How does that fit your prophecy, your narrative of North Shore down 30% by December????

In fact, this serves to highlight the volatility of median house price data and the folly of relying on it.

Using the superior HPI, North Shore is down about 15-16% from peak.

Over to you then oh Mighty One. How will you respond to a challenge to your godly authority?

by Future | 15th Nov 22, 5:09pm 1668485393

Easy.

Within Auckland, six of the seven territorial authorities had annual price decreases, with the North Shore’s the largest at 28.6% (to $949,000).

Prices were down annually in seven of the region’s eight territorial authorities, but South Wairarapa’s dropped the most with a 27.5% fall (to $700,000).

https://www.stuff.co.nz/life-style/homed/real-estate/130137138/house-prices-inch-up-between-august-and-september-real-estate-institute-data-shows

by HouseMouse | 15th Nov 22, 5:28pm 1668486483

Sorry but surely you can do better than that? Real prophets are far better at spin!

That story is more than a month old and doesn’t account for the increase of 26% (yes, 26%) in the median house price on the North Shore between September ‘22 and October ‘22.

Is the prophet being shown up as a false prophet???

by Future | 15th Nov 22, 6:42pm 1668490947

"That story is more than a month old " Yes , maybe it's at -30% now.

by BigBen | 15th Nov 22, 6:50pm 1668491450

It‘s not though, as HM said it’s 18%. Lower Hutt’s looking like a train wreck though, down 26.5% on the HPI.

by Future | 15th Nov 22, 7:17pm 1668493021

-30% Crash In Home Prices by December , its a Certainty !

"All eight Territorial Authorities (TAs) had negative annual median price movements, with South Wairarapa seeing the greatest decrease, down 33.7%, followed by Carterton, down 26.5%."

https://www.reinz.co.nz/Media/Default/Monthly%20Press%20Release%20Asset…

Lets watch HouseMouse fly into his Jealous Rage.

by HouseMouse | 15th Nov 22, 7:12pm 1668492747

Jesus you are lame and full of BS sometimes! Have a good night

by Flying high | 15th Nov 22, 8:57pm 1668499031

Don't bring Jesus in to your argument HouseMouse. Blaspheming will bring trouble on you and your family.

by Pragmatist | 16th Nov 22, 6:27am 1668533247

Sometimes?

by BigBen | 15th Nov 22, 4:15pm 1668482143

It was noted that during that period, "there was a marked increase in the percentage of properties sold under the million-dollar mark compared to the same time last year, which will have contributed to the decrease in median price."

Regardless, the most recent data says it's now sitting at 18% down, HPI 16% - which seems about right.

by interesting1234 | 15th Nov 22, 12:20pm 1668468053

Nelson median house price went up, bucking the trend, however this is skewed by all the houses at the top of the market selling to cashed up folk. RE agents reporting a significant increase in buyers from AKL and WLG into the region and some outflow of baby boomers heading to other parts of the country to be closer to their kids and grandkids. Guess many are leaving the big centres for a different lifestyle

by delboy | 15th Nov 22, 9:57am 1668459451

People are getting pay rises, immigration is increasing and we’ll likely see a new govt in power after sept 2023 so I think the median house prices will decrease further over the next 6 - 12 months before stabilising and then increasing as per the historical trend line.

by tomjones_04 | 15th Nov 22, 10:45am 1668462358

I think you are right about the next 6-12 months but I really can’t see an uplift in prices after that. Particularly after a DTI is introduced. That will choke back investors who have been the biggest drivers of price increases in the last couple of decades…(well and let’s not forget the contribution of the RE industry, agents etc). I think the unaffordable housing will become difficult for the government to navigate moving forward. Even the Reserve Bank are using the word ‘unsustainable’

by HouseMouse | 15th Nov 22, 11:01am 1668463318

As I have said before I think house prices will stop falling in late 2023. They will then only very slowly start inching up though 2024-2025.

If I was a prospective FHB I would be looking to buy around July /August 2023.

by Waikatohome | 15th Nov 22, 12:33pm 1668468794

I tend to agree, there are some positive indicators. Shipping rates have fallen fast and a stronger dollar means that inflation may have peaked and will likely fall from the New Year. Immigration is also increasing and tourism taking off again. We may see a split market with family houses in nice areas recovering but oversupplied town houses continuing to slide. The main risk to watch for would be rising unemployment in the tech sector and construction.

by HouseMouse | 15th Nov 22, 2:16pm 1668474994

Yep. I think the path of the war will have a big influence too ie. if peace was reached within 3-4 months (admittedly unlikely) then that would be good for economies and inflation.

by Future | 15th Nov 22, 3:27pm 1668479273

HouseMouse - You are not good at predicting Future Events. You have said this yourself and Proven it.

Best leave The Future to The Future.

You are good at Predicting the Past.

So I suggest you stay with Tony the Comb. Its Easy, Predictable, Safe and Guaranteed.

by HouseMouse | 15th Nov 22, 3:33pm 1668479633

My predictions have largely been excellent over the past three years, with a far higher accuracy that economists. The one thing I got very wrong was the end point of interest rate increases.

by Carlos67 | 15th Nov 22, 3:54pm 1668480874

I think everyone got that one wrong, went for a 1 year TD about 1 month before rates started to take off. Probably would pay me to break it now and get whatever the 9 month rate was and reinvest at the current rate as I'm now getting spanked hard.

by Future | 15th Nov 22, 3:54pm 1668480877

"My predictions have largely been excellent over the past three years, with a far higher accuracy that economists." Are you related to Yvil ?

by donny11 | 15th Nov 22, 10:07am 1668460054

Hard to say. Really comes down to the direction our monetary policy takes.

I would not rule out further manipulation of the basket of goods to artificially lower inflation. The govt looks like it will pass a a law removing the independence of stats NZ.

https://www.rnz.co.nz/news/national/471263/statistics-experts-fear-law-…

There is also talk at the Fed of altering the inflation target. Something similar could happen here...

https://www.chicagobooth.edu/review/what-would-happen-if-fed-raised-its…

by andrew6 | 15th Nov 22, 10:56am 1668462981

Shift the goal post............excellent

by Averageman | 15th Nov 22, 10:42am 1668462128

Him the spring breakout touted by the vested interests is far from that. Wait till interest rates increase next week, and again in Feb and again.....

You get the picture.

by mfd | 15th Nov 22, 10:45am 1668462312

Well the HPI graphs are looking a lot flatter, could even be consistent with a bottom forming. Or, is it the 'spring bounce' superimposed on a downward trend? Place your bets now!

https://www.reinz.co.nz/Media/Default/Monthly%20Press%20Release%20Asset…

by Ahuhyeah | 15th Nov 22, 12:16pm 1668467768

I'm inclined to think the later

by Independent_Observer | 15th Nov 22, 2:41pm 1668476467

For that line to flatline from here, NZ needs the US fed to pivot on its monetary policy.

Or wage inflation to stay at 10% for a number of years, but in which time, we see real house prices (i.e. in inflation adjusted terms) fall substantially.

If you run the cash flows on an investment with 8% increases in income (rent or wages), but with the discount rate rising from 2% to 8%, then the nominal present value of those discounted cash flows drops around 40%.

Aligns with what has happened this year to the 20+ year US treasury bond fund - its down 45% so far by discounting future cash flows at a higher rate.

by Nellbell | 15th Nov 22, 12:34pm 1668468866

Looking at the HPI ( just a glance) it looks to be doing exactly the same as previous in months in my area - Wellington Wairarapa, except that Porirua and Wellington city are now plateauing a bit. This region had huge rapid increases and they are still unwinding fast.

A bit of variation across regions now, looks like retirees are headed to the sunny North, Gizzy, Marlborough and Southland.

Brock, South Wairarapa is still decreasing :)

by interesting1234 | 15th Nov 22, 12:23pm 1668468194

Fleeing to live out the yesteryears where the lifestyle is best and the sunshine is common

by Smudge02 | 15th Nov 22, 10:52am 1668462744

However there are signs the recent falls in house prices may be starting to abate.

I wouldn't be getting too excited, we were told "Inflation has peaked" and "Interest rate rises have peaked" in recent times only for the situation to worsen.

Bought a paper for the first time in a long time the other day, the pull out property section was thicker than the actual newspaper.

by Future | 15th Nov 22, 11:20am 1668464441

The Party Hasn't Even Started !

by OldSkoolEconomics | 15th Nov 22, 7:18pm 1668493083

Agreed. Inflation is raging globally. Ìnterest rates have a long way to rise... and will trigger a recession in most of the west.

Until reserve banks see inflation fall they will push to destroy demand..i dont think we have even seen the start of the outcomes they need.

by hemihua | 15th Nov 22, 10:58am 1668463087

I feel like I read this optimism that "there are signs of stabilising" in an article every week, yet... I guess eventually it will be correct, much like a broken clock.

by Future | 15th Nov 22, 11:24am 1668464684

It's falling Off a Cliff, but there was a gust of wind that slowed the fall down for 1 second.

by mfd | 15th Nov 22, 12:31pm 1668468671

To be fair, the national month-on-month HPI trend has gone from -1.3%, -0.7%, to 0.2%. That is stabilising. Time will tell if this is seasonal or cyclical.

by beau | 16th Nov 22, 8:59am 1668542358

Hell of a rollercoaster.

by lekkerbydiesee | 15th Nov 22, 11:00am 1668463226

a modest house in my street for $3.3M yesterday. 50% above CV.

Looks like still some froth and crazy stuff going on out there.

https://www.trademe.co.nz/a/property/residential/sale/auckland/north-sh…

by HouseMouse | 15th Nov 22, 11:04am 1668463444

Wow. Lovely place but that’s stupid money.

by Brock Landers | 15th Nov 22, 11:14am 1668464073

Just need to cut down those Norfolk Pines to increase the value more.

by Happy_Medium | 15th Nov 22, 11:21am 1668464488

Nice bath tub.

by Carlos67 | 15th Nov 22, 12:30pm 1668468642

Same as mine its a Spa Bath and you don't need to spend $3.3 Million to get one. That's an expensive road, its beside the Golf course, my mother looked at buying a place there many years ago it was overpriced for what it sold for back then. Old houses as well.

by Brock Landers | 15th Nov 22, 2:43pm 1668476597

The corner tub oozes that trendy 1990s vibe.

by Carlos67 | 15th Nov 22, 3:56pm 1668480974

Beats a tin tub in the outback somewhere.

by Zen20 | 15th Nov 22, 7:29pm 1668493741

I suspect some illicit Rand may have been in the mix

by RickStrauss | 15th Nov 22, 11:16am 1668464188

The house is okay, but not amazing at all. 827m2 of land.

by Poppyc | 15th Nov 22, 12:15pm 1668467747

that's insane for what it is.

On the Shore I added the following to my watchlist. Out of Westlake zone but was last bought in March 21 for 1.34m so a good test to see how the market has moved. There's a big development next door to it though which may compress the price (maybe 9 townhouses)

https://www.trademe.co.nz/a/property/residential/sale/auckland/north-sh…

(they should have cleaned the rangehood filters, naughty)

by huttman | 15th Nov 22, 11:03am 1668463425

We have just passed the lowest price stage of the housing market.

by Caughtinthemiddle | 15th Nov 22, 11:11am 1668463904

Genuinely interested what you base that on?

by RickStrauss | 15th Nov 22, 3:08pm 1668478080

"huttman"

...

...hope?

by huttman | 15th Nov 22, 11:53am 1668466397

actually the question is not about how people 'hope', it's about when will the housing market turn up again.

I don't know when will it happen, but I do know it will happen.

by Nzdan | 15th Nov 22, 6:29pm 1668490199

Yes it happened in Ireland. Prices there fell up to 70% in 2007, and but the market was resilient and prices returned to their 2007 peak I think last year??

by huttman | 15th Nov 22, 11:43am 1668465838

a few points that I was thinking,

A, after reading the median price chart, prices reached the lowest point back August.

B, also reding the nzx50 index, the lowest dip was June and August.

nzx50 is not housing market, but it's indicator of the general financial market, which co-related to the housing market.

C, housing prices has dropped more than people realized, if you take CPI into consideration.

by Solid_Granite | 15th Nov 22, 11:51am 1668466317

If we're basing it on graphs, google 'market bubble graph' and observe how closely NZ's property market follows it. So this might be a 'bull trap' or 'return to normal' phase

by huttman | 15th Nov 22, 12:22pm 1668468144

bull trap could be a big problem, but looking at NZX50 index, it has increased 2.78 times in past 10 years, while house price has increased 2.18 to date. if housing market is in bull trap, then NZX is in trouble too. if so, we are in real trouble when literally our two biggest financial sectors are in the poop.

by Independent_Observer | 15th Nov 22, 2:23pm 1668475397

"bull trap could be a big problem, but looking at NZX50 index, it has increased 2.78 times in past 10 years, while house price has increased 2.18 to date. if housing market is in bull trap, then NZX is in trouble too. if so, we are in real trouble when literally our two biggest financial sectors are in the poop"

All asset prices (including housing) are in big trouble unless there is a significant shift in monetary policy from the Fed. And until they start seeing deflation on the cards, I don't think we are going to see a change.

by chebbo | 15th Nov 22, 11:18am 1668464304

-5%: Not a crash.

-10%: Not a crash.

-15%: No, a crash is generally accepted to be -20% from peak.

-20%: Still not a crash, there's actually no formal definition of a crash, duh.

+0.2%: Hey, look! The market's stabilizing!

by HouseMouse | 15th Nov 22, 11:27am 1668464863

I have no way of proving this, but potentially there could be a little bit of the following at play right now - a mini ‘sweet spot’ to buy over the past 2-3 weeks, prices are way down and while interest rates are increasing, they are likely to go a fair bit higher by April.

Thoughts?

by Caughtinthemiddle | 15th Nov 22, 12:04pm 1668467092

HM I think you are onto something. There may be some who have been holding out who have seen some price drops and want to beat the next round of interest rate rises in the belief that most of the correction has occurred.

by HouseMouse | 15th Nov 22, 1:03pm 1668470580

Yep. And then another significant dip come January - March

by Caughtinthemiddle | 15th Nov 22, 1:53pm 1668473596

If China opens up as now speculated then we are going to see inflationary pressures go to the next level. The OCR could become baked in at circa 5% for a year or more and that will definitely add a new dimension to the story of housing declines.

by Solid_Granite | 15th Nov 22, 11:28am 1668464881

We're going to bypass the crash definition and jump straight to collapse

by SND | 15th Nov 22, 11:49am 1668466161

Bull trap anyone?

by Carlos67 | 15th Nov 22, 12:57pm 1668470255

Like I said before if the cost of new builds has rocketed up 20%, how long do you think house prices will keep falling ?

by Brock Landers | 15th Nov 22, 1:20pm 1668471659

The cost of new builds may well fall 20% as the bust sets in.

by Carlos67 | 15th Nov 22, 1:29pm 1668472145

Well the odd builder may get caught out for sure, its happened before. The first house we purchased in NZ back in the late 70's we had to finish off ourselves because the builder pulled the plug. Thing is there will not be many bargains and builders don't build to sell at a loss so only one guess what happens next.

by Caughtinthemiddle | 15th Nov 22, 1:48pm 1668473293

Land value falls?

by Independent_Observer | 15th Nov 22, 2:29pm 1668475758

Lol - yeah was thinking widespread defaults on bad debt - a game of hot potato to see who carries the loss. The builder/developer or the buyer.

by Brock Landers | 15th Nov 22, 2:42pm 1668476541

No I'm not saying the odd builder gets caught out.

I'm saying that the cost of materials and labour may crater.

by Nzdan | 15th Nov 22, 6:36pm 1668490577

Agreed. It all depends on what is actually driving the increases in cost of materials. Is it true input costs or opportunity to price gouge?

I work as an Estimator, while input costs set a price floor, they don't dictate the upper price limit. Certainly if we had less competitors in the market than say Winstone Wallboards and our product was hard written into an Acceptable Solution/Verification Method, then our upper limit will be what the market is capable of paying.

by Three Veg | 15th Nov 22, 2:00pm 1668474028

Nothing goes to heck in a straight line, as they say.

The positive blip in October probably reflects some temporary optimism there was at the time around a interest rate pivot.

by jimmyH | 15th Nov 22, 2:06pm 1668474388

Agree. As 60-80% of mortgages refix in he next 24 months, it is very premature( illogical) to think one upward blip in a downtrend, is " the bottom is in". Every OCR increase,decreases the borrowing power( offering price) of any borrowing purchaser,and anyone can see that mortgage rates are going to be on an upward track for a year or more ,to come .

by Independent_Observer | 15th Nov 22, 2:20pm 1668475237

Our speculative housing market still appears to be highly correlated to the speculative US share market. Looks like head/shoulders type pattern of a falling market.

A brief plateau before falling further. A shift in interest rate policy is the only thing that could save the markets from here.

So pray for deflation if you are long housing or stocks (or oddly even bonds!)

by Independent_Observer | 15th Nov 22, 2:35pm 1668476135

Interesting conversation at the weekend with an experienced property developer from Auckland (won't name company etc). He's decided to pull the pin and has left the industry this year. Thinks the markets changed and the risk no longer justifies the potential gain. Sold the family home in Auckland and moved elsewhere - holding onto one apartment in Auckland if they need a place to stay there from time to time - otherwise its time for an early retirement.

Perhaps another sign that the smart money is leaving the game - and perhaps like what we're seeing with FTX/crypto - its those who think they can't lose who do end up losing (everything).

There are so many warning signs around us at present that risk is very high - if people do get burnt in the next 12-24 months, you can't say that there were no warnings, nor signs.

by Ahuhyeah | 15th Nov 22, 7:58pm 1668495522

Hearing from friends architect friend (judge the reliability for yourself) that forward work has dropped off significantly. Working through the narrowing list of backlog but ... after that....

by estateagent | 15th Nov 22, 4:50pm 1668484244

Prices have further to fall

by Zachary Smith | 15th Nov 22, 7:14pm 1668492840

I have to say the median price graph matches my observations of the auction results. They are even a little less pessimistic. The prices have come down but not hugely, certainly not back to 2019 levels yet. I'm still confident that auction results are a useful bellwether for determining what's going on with the broader market.

Checking today's results reveals no bargains. Some good prices being fetched for choice properties and some bids passed in that try to secure a property for a 2019 price.

by 7jai | 15th Nov 22, 8:31pm 1668497508

Interest rates will stabilize especially after the US had a better than expected inflation number. This number will only continue to go down to the aggressive sudden rate hikes. It usually takes at least 6-12 months to feel any impact from interest hikes and now we are feeling it.

First it's the US, and then comes its other followers like NZ. Enjoy all!

-7

by Future | 17th Nov 22, 6:38pm 1668663497

Dreamer !