The average value of NZ homes rose $3400 in October

Property / news

CoreLogic says average housing values are likely to keep rising but a market recovery could be subdued

1st Nov 23, 12:01am by Greg Ninness

The average value of New Zealand homes increased by $3408 in October to $908,853, according to the CoreLogic House Price Index.

Average dwelling values were up in most parts of the country, with the biggest monthly increase of $38,678 occurring in Banks Peninsular.

However there were also some notable declines in value as well, with the biggest occurring in Auckland's Gulf Islands, which is dominated by Waiheke Island, where the average dwelling value declined by $89,577 in October.

According to CoreLogic's October report, the change in property values outside the main centres was relatively diverse.

"Rotorua, Gisborne, Whangarei and Hastings recorded solid increases (in average values) of almost 1% or higher, but Invercargill, New Plymouth and Whanganui all recorded falls of at least 1%," the report said.

"Over the past three months New Plymouth has dropped by almost 3%, whereas Hastings has increased by nearly the same amount."

CoreLogic NZ Chief Property Economist Kelvin Davidson said is seems pretty likely values will continue to rise in the coming months, but increases may not be seen in every month or location.

"This 'recovery' could remain fairly subdued by past standards, given that housing affordability is still problematic, mortgage rates aren't set to fall anytime soon and caps on debt-to-income ratios are still on the cards for 2024," he said.

The table below shows average values and their movement since September, for all main urban districts throughout the country.

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CoreLogic House Price Index
Three Months to October 2023
	Average Property Value
Territorial Authority	Three months ending September 2023	Three months ending October 2023	Difference
Far North	$682,988	$679,960	-$3,028
Whangarei	$729,717	$736,744	$7,026
Kaipara	$802,994	$824,335	$21,342
Auckland - Rodney	$1,231,078	$1,237,443	$6,365
Rodney - Hibiscus Coast	$1,141,928	$1,151,295	$9,367
Rodney - North	$1,300,591	$1,304,440	$3,850
Auckland - North Shore	$1,425,395	$1,431,987	$6,593
North Shore - Coastal	$1,633,345	$1,632,854	-$491
North Shore - North Harbour	$1,390,473	$1,406,285	$15,812
North Shore - Onewa	$1,134,409	$1,143,508	$9,099
Auckland - Waitakere	$987,925	$993,039	$5,114
Auckland - City suburbs	$1,445,666	$1,444,765	-$901
Auckland City - Central	$1,225,047	$1,247,305	$22,258
Auckland City - Islands	$1,562,063	$1,472,486	-$89,577
Auckland City - South	$1,302,996	$1,288,400	-$14,596
Auckland_City - East	$1,807,784	$1,808,827	$1,044
Auckland - Manukau	$1,141,474	$1,139,706	-$1,768
Manukau - Central	$879,831	$878,892	-$939
Manukau - East	$1,432,821	$1,434,215	$1,394
Manukau - North West	$993,385	$989,834	-$3,551
Auckland - Papakura	$913,032	$933,200	$20,168
Auckland - Franklin	$905,200	$902,917	-$2,283
Thames Coromandel	$1,103,574	$1,132,182	$28,608
Hauraki	$629,159	$635,090	$5,931
Waikato	$719,948	$722,371	$2,423
Matamata Piako	$686,710	$690,777	$4,068
Hamilton	$787,616	$797,950	$10,334
Hamilton - Central & North West	$741,952	$747,207	$5,255
Hamilton - North East	$967,941	$983,243	$15,302
Hamilton - South East	$722,656	$732,472	$9,816
Hamilton - South West	$700,392	$709,707	$9,315
Waipa	$867,613	$877,375	$9,763
Otorohanga	$527,875	$531,538	$3,663
South Waikato	$420,784	$416,707	-$4,076
Waitomo	$378,901	$368,528	-$10,373
Taupo	$825,364	$825,170	-$194
Western BOP	$999,424	$1,006,075	$6,651
Tauranga	$1,007,262	$1,006,129	-$1,133
Rotorua	$634,972	$652,561	$17,589
Whakatane	$740,633	$741,536	$902
Kawerau	$393,501	$394,990	$1,489
Opotiki	$505,120	$507,982	$2,862
Gisborne	$589,914	$596,121	$6,207
Wairoa	$401,444	$383,742	-$17,702
Hastings	$778,707	$785,600	$6,894
Napier	$746,181	$746,858	$677
Central Hawkes Bay	$590,932	$589,470	-$1,462
New Plymouth	$704,137	$695,706	-$8,431
Stratford	$476,245	$475,641	-$604
South Taranaki	$430,752	$434,449	$3,698
Ruapehu	$364,571	$357,617	-$6,954
Whanganui	$497,299	$490,210	-$7,089
Rangitikei	$421,858	$419,556	-$2,302
Manawatu	$597,094	$598,181	$1,087
Palmerston North	$635,948	$636,879	$931
Tararua	$403,772	$413,441	$9,669
Horowhenua	$556,260	$566,658	$10,399
Kapiti Coast	$800,728	$789,702	-$11,027
Porirua	$805,927	$824,166	$18,239
Upper Hutt	$726,120	$727,042	$922
Hutt	$755,260	$757,669	$2,408
Wellington City	$1,017,835	$1,018,073	$238
Wellington - Central & South	$971,436	$977,556	$6,120
Wellington - East	$1,127,305	$1,136,466	$9,161
Wellington - North	$965,464	$961,583	-$3,881
Wellington - West	$1,153,955	$1,150,503	-$3,452
Masterton	$554,489	$556,775	$2,286
Carterton	$622,829	$617,920	-$4,909
South Wairarapa	$751,965	$730,202	-$21,763
Tasman	$766,957	$771,692	$4,735
Nelson	$773,219	$772,610	-$609
Marlborough	$695,081	$695,549	$468
Kaikoura	$666,154	$666,814	$659
Buller	$327,511	$332,716	$5,205
Grey	$373,136	$371,495	-$1,640
Westland	$394,624	$382,713	-$11,911
Hurunui	$609,070	$618,138	$9,068
Waimakariri	$693,083	$697,493	$4,410
Christchurch	$733,506	$741,178	$7,672
Christchurch - Banks Peninsula	$779,316	$817,995	$38,678
Christchurch - Central & North	$831,239	$845,027	$13,788
Christchurch - East	$576,759	$578,276	$1,518
Christchurch - Hills	$1,026,425	$1,047,083	$20,658
Christchurch - Southwest	$697,351	$702,377	$5,026
Selwyn	$810,480	$818,755	$8,275
Ashburton	$532,398	$528,564	-$3,834
Timaru	$507,360	$511,242	$3,881
MacKenzie	$764,909	$745,795	-$19,114
Waimate	$430,700	$417,712	-$12,988
Waitaki	$472,180	$465,778	-$6,402
Central Otago	$791,570	$792,814	$1,245
Queenstown Lakes	$1,669,277	$1,677,669	$8,392
Dunedin	$610,715	$615,784	$5,069
Dunedin - Central & North	$621,954	$625,272	$3,318
Dunedin - Peninsular & Coastal	$571,089	$591,550	$20,461
Dunedin - South	$577,625	$584,563	$6,938
Dunedin - Taieri	$642,708	$644,821	$2,112
Clutha	$374,950	$379,681	$4,730
Southland	$494,962	$488,974	-$5,988
Gore	$381,423	$393,454	$12,031
Invercargill	$462,588	$458,040	-$4,548

Auckland Region	$1,259,296	$1,261,776	$2,479
Wellington Region	$890,429	$893,417	$2,987
Main Urban Areas	$1,000,288	$1,003,685	$3,397
All of Aotearoa	$905,445	$908,853	$3,408

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86 Comments

by Qq | 1st Nov 23, 6:48am 1698774519

More waffle from interested parties. The slight increase is all noise in the data. If there were confidence intervals they would almost certainly cross 0 indicating a statistically insignificant increase.

by Chaosinflesh | 1st Nov 23, 7:06am 1698775585

Personally, I'd love to get my hands on the raw data before outliers are removed, what groupings are made, etc.. But as long as their process has been consistent over the years, there is still value in the presentation.

Of course, it's a private company with a product to sell - maybe I didn't look hard enough, but their process appears to be 'proprietary'.

by Matt_09 | 1st Nov 23, 7:56am 1698778572

Shows where the mainstream media get their money from- both NZ Herald and stuff leading with ‘downturn over say core logic’.

by Nzdan | 1st Nov 23, 9:19am 1698783588

The question would be around their methodology with like for like properties. Even with a consistent process, average prices can remain static while the composition of properties sold can change. Are buyers on average getting an extra bedroom for the same money?

E.g.

1/3 2 bedroom, 1/3 3 bedroom, 1/3 4 bedroom at average of $700k vs
1/10 2 bedroom, 5/10 3 bedroom, 4/10 4 bedroom at average of $700k.

by tothepoint | 1st Nov 23, 11:21am 1698790916

Certain people here have trouble accepting that property markets are cyclical. That is, property markets rise - as well as fall.

There’s little point in becoming dismayed about the market becoming more buoyant - with prices increasing. It was bound to happen…… And, in time, it will slow down again.

In my view, those who struggle with the above ought to stay away from property altogether because they only risk becoming flustered - wasting personal energy. Better to channel one’s energy into something more constructive.

TTP

by Nzdan | 1st Nov 23, 10:00am 1698786024

Unsure of the angle of your comment. If you're suggesting I may be angry or bitter about the data, certainly not the case as I'm a "homeowner" and house prices rising will benefit me.

Unlike some however, I can throw a few rational "reckons" at the data rather than letting my vested interests cloud my judgement and narrative.

by FOTC | 2nd Nov 23, 8:31pm 1698910301

How do rising house prices benefit you as a homeowner? I assume you must own multiple properties?

by danicriss | 1st Nov 23, 10:00am 1698786029

I see acceptance of rising prices. I see much less acceptance of the opposite, which by your words of wisdom should be equally embraced

by 1689 Baptist | 1st Nov 23, 9:49am 1698785389

The Corelogic House Price Index is probably the most accurate measure for trends. Outliers and noise are smoothed out. But you are correct. If the jump or drop in your district is small this month don't get too excited about it.

by IT GUY | 1st Nov 23, 8:11am 1698779487

Still s shitload of residential building going on in Auckland. Forward BCs look sad. I see the chineese developer that bought my glendowie house to redevelope land is busy painting it , looks like they will bail..... overs/unders $1mil loss....

by ikimpaul | 1st Nov 23, 8:13am 1698779603

interestingly here in the hutt real estate agents have been talking up the prices for the last couple of months and everything has been listed as "by negotiation" or deadline tender with very few listed prices, and then all of a sudden this week , a large number of houses that previously were listed as "by negotiation" have prices on them.

I'm sure the recent influx of listings and prices going on the houses is merely a coincidence.

by huttman | 1st Nov 23, 10:36am 1698788205

the prices in the Hutt area has passed the lowest. and the price predictions on website like Homes are about 3 months behind.

by Caughtinthemiddle | 1st Nov 23, 8:16am 1698779804

I don't like the outcome but the data shows a trend that's echoed by the REINZ month on month data. I'm forced to concede that our migration flow is probably having more of an upward impact than the OCR is on reducing energy in the market now. I'm just waiting to see the roads choke with cars, elective operating and ED wait times soaring and our young kiwis struggle to reach mediocre educational milestones. Oh wait that's already happening......

by facepalm | 1st Nov 23, 8:56am 1698782160

I would have to agree unfortunately... I always read comments and there seems to be more of what people want reality to be than what it actually is.

Interest rates have moved a lot higher, there is a large contingent who would like to have seen prices fall a lot further, either out of self interest (missed the boat) or a general desire to see housing more affordable (which I think most people can be on board with). The reality of the data at the moment is that supply is constrained and crappy as always, forward consents are down, immigration is pumping away (National are not about to stop that), NZ is a safe little island (apart from gangs booming roll call). Immigrants want to buy, first home buyers don't want to delay life forever, transactions need to happen and for a number of reasons and supply and demand is putting a floor on things. It can be argued whether it is technically the bottom, noise in the data, further to fall but I think objectively it can be said that the ass is no longer (currently) falling out of the market. It may still happen for other reasons but it isn't at the moment.

by RickStrauss | 1st Nov 23, 10:17am 1698787077

And we've just elected a govt of sorts that has a propensity and intent of supporting welfarism for property speculators off the back of productive society.

by Jesse1 | 1st Nov 23, 12:36pm 1698795411

Yes compared to how most countries operate the property investing class in NZ are a massive beneficiary group in this country. Then they see themselves as part of the hard working business owning Kiwis unlike all the undeserving slackers that vote Labour...

by RickStrauss | 1st Nov 23, 12:59pm 1698796790

Meanwhile, come a flood or earthquake, they have their hands out very quickly for the taxpayer welfare they'd happily cut for poor people.

by Rob Reid | 2nd Nov 23, 10:18pm 1698916726

"...a govt of sorts..." - LOL

by lockdowndays | 1st Nov 23, 10:14pm 1698830072

Yes it sucks, it is not allowed to be a normal fair market with real boom/bust cycles like in most other countries due to the huge amounts of people flowing into the country to keep the demand high. The only things on the horizon that may well stop everything in its tracks are a) Unemployment shooting up and/or b) Reserve bank sees prices taking off and slaps a big fat loan-income ratio on the banks come March

by Smudge02 | 1st Nov 23, 9:49am 1698785391

Yes as much as it irks me I am certainly starting to think that the property ponzi in NZ is in fact an unstoppable force. With the immigration flood gates wide open, a pro-property Govt and the simple fact that property 'is' the NZ economy there seems to be only one way forward, the wrong way IMO but thats what we have chosen for decades and continue to do so.

by danicriss | 1st Nov 23, 10:20am 1698787250

Both these comments are pertinent and underlied by the fact that NZ has never seen a property bust. It's ingrained in the NZ mentality that house prices keep rising

Take the income multiple as a measure and you will realise this cannot go forever. The question is what will the general public's reaction be when things grind to a halt given that some have based their financial decisions on ever increasing prices? The capital gains were baked into decisions to buy negatively geared investment houses. Or into decisions to buy a home for a set number of years while being overleveraged

Yes, you are right and will be right for a few months more, at least. It's just that the economical sense for sustaining these prices paints another picture staring further and further into the future

And don't get me started on the impact of automated driving or work from home, which has been looked at only with a macro lens limited to the present

by Cote d'Azur | 1st Nov 23, 8:20am 1698780014

Auckland Central is preparing for take off. Could hit 2mill average towards the end of this cycle.

by Chairman Moa | 1st Nov 23, 1:47pm 1698799648

Depending what's going to happen in Gaza.. If it's breaking into a long war, you can bet on a worldwide depression and petrol price of $4+..

50/50 really.

by Zwifter | 1st Nov 23, 2:21pm 1698801676

Its not going to be a "Long War", its about as one sided as it can get. Hamas didn't count on this level of revenge. I'm waiting for mounting pressure to force Egypt to open the border, not sure why they have not done so already at which point a million people plus will leave, its a stay and die or leave option.

by Chairman Moa | 1st Nov 23, 3:45pm 1698806734

The other three neighbours are starting to get itchy!

by danicriss | 1st Nov 23, 4:18pm 1698808721

Israel doesn't have an occupation army, it has a strike-and-retreat one

It also has a lot of neighbourly friends who can't wait to test their attrition rate

Egyptians don't want Palestinians. They're not Ukrainians to be welcome by all neighbours. The percentage of trouble bringers among them is too high for the others to open their borders

So Israel has to contend with an attritional urban war among rowdy neighbours smelling blood with the backdrop of western media slamming their warcrimes

by tothepoint | 1st Nov 23, 4:33pm 1698809635

......... you can bet on a worldwide depression and petrol price of $4+.

Someone's being a little misery merchant today.

TTP

by Chairman Moa | 1st Nov 23, 4:43pm 1698810222

I am actually feeling positive.

Will be selling the house and downsize into a nice apartment and a 1970s car to muck around.. no more lawn to mow !

by Retired-Poppy | 1st Nov 23, 8:25am 1698780341

"Any recovery will be subdued"

As we head into the next downturn, any celebrated price gains will amount to zip. For transparency sake, when adjusted for inflation, these "so called" gains will translate into continued falls. House price depreciation will intensify on trend as we head into autumn 2024.

Money is expensive and there remains a glut of expensive housing.

by Matt_09 | 1st Nov 23, 9:02am 1698782532

I’m pretty sure you’d previously said the same about mid to late 2023? Yep interest rates will continue to bite but there is still plenty of money out there chasing these properties and the numbers are tracking the opposite to what you keep saying. For the record I have no vested interest and think our housing is extremely overpriced but none of the stats point to your prediction

by Retired-Poppy | 1st Nov 23, 9:29am 1698784161

When you get a spare moment read the latest RBNZ financial Stability Report released here. The impact of recent interest rate increases is yet to be seen.

https://www.interest.co.nz/economy/125006/latest-reserve-bank-financial…

Like I've posted at various times throughout 2023, we are a nation of debt addicts and the coming fallout from Autumn 2024 is simply inevitable.

by Uncle Bulgaria | 1st Nov 23, 9:27am 1698784073

I refix in Autumn 2024 - Hope it comes earlier.

by HouseMouse | 1st Nov 23, 9:31am 1698784288

I refix in July. I think I will go 6 months, how about you?

by Zwifter | 1st Nov 23, 9:47am 1698785274

That's why the RBNZ are still waiting, they are waiting for people like you on the longer terms to roll over. Pretty much everyone will have rolled over in the next 12 months to higher rates. They are signalling a hold for November.

by Matt_09 | 1st Nov 23, 11:05am 1698789951

Jan 26 for me!! Wonder what shape we’ll be in by then?

by unaha-closp | 1st Nov 23, 11:05am 1698789923

This.

Annualised this price increase is only 4.3%. Our CPI is 5.6%. Our house prices are performing worse than inflation.

by facepalm | 1st Nov 23, 11:12am 1698790362

The debt has got 5.6% less due to inflation.... Only a disadvantage for those who are debt free, but then I guess they are using it for it's intended purpose, accommodation. They are also probably not that bent out of shape about a year or two of inflation being higher than house price appreciation.

by Independent_Observer | 1st Nov 23, 11:27am 1698791243

The debt hasn’t got 5.6% less because of inflation! The cost of that debt has become significantly more expensive as well and for many people the cost of the internet expensive has gone up more than their increase in incomes so they are worse off.

Instrad of paying 3% on their 30 year mortgage, people may now be looking at 8-10% for that same mortgage. That is going to chew up a lot of their incomes over the next 30 years.

by JustAnOpinion | 1st Nov 23, 8:51am 1698781873

CPI is at 5.6% for the Sep 23 year which means these circa 1% increases are still 4.6% decreases in inflation-adjusted terms.

Wage inflation is trailing at 4.3% and if you look at the LCI / CPI graph here - https://www.stats.govt.nz/news/annual-wage-cost-inflation-remains-at-4-… - you can see that it is not really until the CPI gets under ~2.5% that wages have a chance to catch up.

by facepalm | 1st Nov 23, 9:00am 1698782416

You're not wrong for a house owned debt free, but it is a different story for one leveraged.. Inflation does a wonderful job of inflating away debt. It can a gift that keeps on giving for people who can afford the interest payments..

by Independent_Observer | 1st Nov 23, 9:52am 1698785528

I think this is a fallacy - it works if incomes are rising and the cost of debt is flat or falling (ie the last 40 years!)

But if your interest payments on debt are rising faster than your increase in income (as a result of the general inflation) I’m not so sure about the inflate away the debt theory. You end up paying a shit load in additional interest expense that could have been invested in other ways to provide an economic benefit. Eg if you have a $500,000 in housing debt and refix at todays rates instead of rates from two years ago, are you now better or worse off? And if interest rates keep rising for the next 25 years how much additional income is this going to take from you in the future in interest expense (that could have been invested elsewhere)

I agree with the theory when rates are flat or falling but I find it difficult to fathom in the current context - it just looks like economic pain to me giving more and more of your income (in interest expense) to the bank to own the same home.

by HouseMouse | 1st Nov 23, 9:59am 1698785944

Agree

by Independent_Observer | 1st Nov 23, 10:26am 1698787564

The key assumption people appear to miss in the inflate away debt theory is that only their wages will rise relative to the size of the mortgage - but never go..’well if inflation is as 5% persistently then there is the risk we have 8-10% mortgage rates on a very high level of initial debt relative to my current income and if my mortgage is $500,000 then interest expense alone is going to chew up a significant proportion of my wages’

It is why price/earnings ratios (ie fundamental analysis) is a timeless principle for investing - but people appear to forget that when it comes to housing. Eg people for example won’t buy shares unless the P/E is low, but people happily buy houses at price/income ratios that are insanely high (by historical records - ie off the charts high). It doesn’t make any sense.

by facepalm | 1st Nov 23, 11:08am 1698790118

You might feel like debt costs are high, but on a historical basis they are not, on the basis of the test rates banks used when checking affordability the are not that high. Any person who took out a 30yr mortgage and then whines about 7% interest rates needs a slap. Having only 7% interest rates and such high inflation is a stoke of luck for the indebted. Historically you would be paying 7% rates with far lower inflation.

Debt is also not a zero sum game. For every borrower there is a lender. Borrower pays more, lender earns more (term deposit holder / saver). If anyone of these two has been disadvantaged by low interest rates and now high inflation it is certainly not the borrower.

by Independent_Observer | 1st Nov 23, 11:21am 1698790896

This isn’t about how I feel - it’s about real numbers and the real costs people are going to get hit with trying to service their mortgages at these new rates.

by facepalm | 1st Nov 23, 11:25am 1698791107

Costs that should be well accounted for and budgeted when they took out the loan.

I'm sure savers including first home buyers will appreciate earning some money on their savings while real estate values have declined / staying flat for a bit.

by Independent_Observer | 1st Nov 23, 2:47pm 1698803235

But this isn’t true - the idea of a 5% OCR was laughed at 2 years ago and it was said (by many people on this forum) to be an impossible outcome.

So a large part of society haven’t planned for mortgage rates to be this high which makes you above statements out of whack with the reality of what is unfolding. Saying they ‘should have accounted for this’ can’t have happened because for many it was deemed impossible.

They ‘should have’ done what you suggested (planned for higher rates) - but many did not even though I (and others) were suggesting they should do so - whole being ridiculed as DGMs by those who said the current environment was an impossible outcome.

People don’t plan for things they deem to be impossible.

by 1689 Baptist | 1st Nov 23, 9:46am 1698785218

While that is valid most house purchases involve large mortgages. The mortgage amount doesn't change with inflation. Therefore, house price increases in nominal terms are a win for mortgaged homeowners. Even if the house value is decreasing in real terms. Inflation is a good thing for asset owners. Even if the high interest rates to counter it are not.

by Independent_Observer | 1st Nov 23, 9:54am 1698785673

The total cost of the mortgage increases a lot! Ie the total interest paid over the life of the loan - you would want to make sure your wages increase more than the additional interest expense for you to be in an improved financial position.

by 1689 Baptist | 1st Nov 23, 1:16pm 1698797787

Yeah I'm pretty sure I said that.

by Independent_Observer | 1st Nov 23, 1:34pm 1698798891

Might want to read again.

(hint: mortgage amount doesn’t change during inflation - but the amount the mortgage will cost you over its life may cost you a hell of a lot more in interest expense)

by refactornz | 1st Nov 23, 3:14pm 1698804843

It's unlikely that interest rates will keep going up forever, but for most people their income will tend to track inflation. So despite some short term pain 1689 Baptist's comment is correct for most home owners over the life of their mortgage.

by rastus1 | 1st Nov 23, 9:05am 1698782752

If prices don't increase a lot of landlords will be bailing - why would you hold a negatively geared property that's straining your personal finances for zero cap gain and losses when that equity could be on term deposit?

The increase in supply from these folk will impact prices.

A matter of time.

by RickStrauss | 1st Nov 23, 10:20am 1698787225

That might be why the Nats want to retrospectively reduce the bright-line period?

by facepalm | 1st Nov 23, 11:21am 1698790897

That's an inevitable swing in the housing market that regularly happens, prices run away, returns no longer make sense, values fall and relatively speaking they look like a terrible cash return - until they are not again. Funny cycle to watch.

In a sustained period of falling or flat prices there is always a portion of the market who realise they mucked up, cash flow dosn't work, or its just not fun owning rentals when prices don't increase 10% every single year and you have the joys of "wear and tear". Supply from these people will increase but that's in no way unusual in the current market.

The Govt pumping the country full of 100k extra people each year will quickly mop this up. Along with further straining our health, education and other public services. Painful to watch.

by HouseMouse | 1st Nov 23, 9:29am 1698784188

The bust is clearly over. Prices edging higher. I am still not convinced it will be sustained strongly though.

We have animal spirits stirred by Spring and the election result, not to mention high levels of immigration.

Yet interest rates will be HFL, and 2024 looks like a hard year for the economy. However, on the latter it’s likely to be lower paid workers who are renters who will tend to suffer more, as job losses in retail and hospo mount (as discretionary spend crashes). The slump in housing construction may not have too much impact on mortgages, given that so many construction workers are foreign and on work visas.

Wellington is worth watching, although the job cuts may not be enough to exert more than a minor negative impact on the housing market.

by rastus1 | 1st Nov 23, 9:48am 1698785327

The bust is clearly over.

What bust are you talking about?

I must have missed it.

by Zwifter | 1st Nov 23, 9:52am 1698785521

There was no bust, prices still didn't drop far enough to zero out the silly 30% rises. We are back where we would have been if rates were not slashed during Covid.

by HouseMouse | 1st Nov 23, 10:00am 1698786048

You don’t call nearly -20% a bust???

Even the Herald used the word ‘crash’ this morning(‘the crash is over’ they proclaimed)

by Nifty1 | 1st Nov 23, 10:24am 1698787457

Can you remind us HM of the % increase in house prices prior to 'the bust'... kind of puts it into perspective.

by HouseMouse | 1st Nov 23, 10:23am 1698787420

As has been pointed out numerous times, a 20% fall nearly wipes out a previous 30% gain.

If the 30% gain was called a ‘boom’, I think it’s pretty logical to call its near complete correction a ‘bust’

by Zwifter | 1st Nov 23, 10:50am 1698789041

FYI It was just called a "Correction"

by HouseMouse | 1st Nov 23, 11:31am 1698791518

The common economic use of the term correction does not imply the near wipe out of a boom.

If prices had fallen say 7-10%, I would have called that a correction.

by Nifty1 | 1st Nov 23, 12:23pm 1698794636

That's incorrect..

by Retired-Poppy | 1st Nov 23, 10:16am 1698787018

The word "crash" was certainly used in the past by a reporter for the Herald. Knowing how dirty a word it is, I'd suspect the user was either enjoying their first day on the job or it was their last.....

House prices in Godzone never "crash" in public.

by Independent_Observer | 1st Nov 23, 10:03am 1698786226

I’m 50/50 that we’ve just witnessed the first act of the show. As the yield curves normalise we will start to see the real market action.

See global share markets - yield curve starting to normalise and equities are getting smashed. Housing might be delayed 6-12 months (but there is at present for example a high correlation between the US share market and our housing market - compare the price charts - so our housing market is as volatile as the US equity market - go figure for a ‘safe asset’).

I think it is just as likely we are seeing a bear market rally as it is that prices have bottomed. We need rising unemployment to get inflation back to 2% (in theory) so that means businesses must fail and people must lose jobs/incomes - none of this is good news for asset prices.

by Zwifter | 1st Nov 23, 9:50am 1698785413

A few are still in denial about prices rising I see. Looks clear to me interest rates have peaked and while the floodgates are held open there will be more rises to come.

by Independent_Observer | 1st Nov 23, 9:56am 1698785765

It was also clear to property experts that rates had peaked this time last year.

by Independent_Observer | 1st Nov 23, 10:06am 1698786413

But then you realise property expert = property propaganda

And if you’ve read enough history you know there is no point in listening to propaganda unless you take pleasure in being a brainwashed fool. And being a brainwashed fool is stupid and dangerous.

by HouseMouse | 1st Nov 23, 10:35am 1698788137

Here’s a question - who would you rate as a genuinely objective and independent economist commenting on the housing market?

I might count Cameron Bagrie, even if I think he suffers a bit of legacy bank indoctrination. I might also include Rodney Dickens. Unfortunately his views are accessible only by subscription (maybe I should subscribe, but really I have too many subscriptions)

I don’t rate any of the bank economists on this criteria, BNZ perhaps the best of a bad lot.

by Independent_Observer | 1st Nov 23, 10:57am 1698789469

Independent_Observer

(all others have financial backing in one fashion or another and hence aren’t really independent).

So if they claim to be independent it’s a sham - like being called the Ministry of Truth in 1984. An independent economist is a myth. They all have a master.

Independent_Observer is his own master and it is free thought - which is where you find the truth - not from the mouths of men who are puppets/mouth pieces for financial gain of the industry. They do no speak the truth for fear of loss of financial gain - and this is the problem.

by Independent_Observer | 1st Nov 23, 11:24am 1698791090

On a more serious note I don’t actually think any are truely independent - and because nearly all have been working in their careers in the 1980’s to now, they’ve only experienced falling interest rates and rising asset prices.

Recency/confirmation bias could be so widespread that it has infected the thinking of nearly everyone - making it impossible to see who is really independent in thought - as opposed to just a bad set of heuristics and bias from industry expectations and recent market events.

by rastus1 | 1st Nov 23, 11:29am 1698791378

Martin North - DFA. Its Aussie data but the underlying issues are the same and he does at times cover NZ directly.

by RickStrauss | 1st Nov 23, 12:24pm 1698794692

Bernard Hickey might also be added. He at least has the advantage of honestly describing what politicians and central bankers have been doing and why it is bad for following generations of Kiwis, even as he notes he of necessity puts his money in the NZ property welfare scheme to protect the interests of his children.

by Chairman Moa | 1st Nov 23, 1:47pm 1698799621

"Looks clear to me interest rates have peaked"

Just hold off a little, petrol price could hit $4/L and the knock on effect will start soon after.

by Independent_Observer | 1st Nov 23, 10:16am 1698786997

NZ housing market (pricing) appears highly correlated t US equity market (Ie it is interest rate sensitive).

I would be watching that as a guide to what way our housing market is heading in the future as there is perhaps a 6 month lag between our housing market and their equities.

US equities have been falling again in recent months so I wouldn’t be so sure that this is the bottom for our housing market (it might be - but if the US equities start tanking I would place a bet that our housing market will follow it down).

by Retired-Poppy | 1st Nov 23, 2:07pm 1698800862

Subdued = Quiet, depressed, sombre, muted, soft and sad.

From an investment perspective, such a forecast is hardly enticing with 8% interest plus rates and insurance...

by J.C. | 1st Nov 23, 12:39pm 1698795540

Ahead of an expected increase in unemployment, the broad recovery in world house prices has continued. US house prices have now reached a new all-time high, up 1½% from last year’s peak. Australian prices are back at the record high reached last year.

Canada will likely match its record high in the next month or so. New Zealand prices continue to recover, but are still well down from their peak. Norwegian prices, which were near their all-time high, took a step back in Q3. Meanwhile, UK and German prices continue to slowly drift lower.

This broad rebound – which has occurred against the backdrop of the lowest unemployment rates in decades – suggests that high interest rates are not constraining all borrowers. This raises the question of whether some households believe interest rate cuts are not far away and/or, more importantly, if monetary policy is not sufficiently tight.

https://www.livewiremarkets.com/wires/a-broad-recovery-in-world-house-p…

by SND | 1st Nov 23, 12:49pm 1698796161

It must be a miracle. Truly.

Take the actual rates, average income and house price, crunch all those numbers and... It makes no sense!

Something must be wrong somewhere, either people have far higher incomes than IRD knows about, or banks are "discounting" their rates, or...

by longjohndrop | 1st Nov 23, 2:57pm 1698803864

Here comes the squeeze. Supply hasn’t been addressed, but demand grows.

10% increase in prices by end of 2024, guaranteed.

by Tui12 | 1st Nov 23, 3:26pm 1698805590

We sold in May went travelling for 6 months now buying in again. You can’t pick the bottom all you get is a smelly finger. You either want to own a house or you don’t.

by timbob | 2nd Nov 23, 6:51pm 1698904284

So you sold at the bottom and are trying to buy back in now prices are getting bubbly again?

by Tui12 | 3rd Nov 23, 3:23pm 1698978196

We sold for 100k more than we paid for it. I don’t care about “bottom” “top” I’m probably like most people and want to live my life owning a house not renting it which was terrible in my experience.

by ChrisOfNoFame | 2nd Nov 23, 11:46am 1698878765

42-44 Byron Avenue, Takapuna, North Shore City - Mortgagee Sale By Tender

All 14 for sale ... Originally listed way, way back for around 1.8m.

(They ran into major issues with the piling which was way too loud ... driven steel piles! The whole area is geotechnically messy! Big chunks of basalt rock all over the place. Why driven steel piles?!? Held it up for months - leaving the framing exposed in the rear block. Love to know the full story behind these.)

by ChrisOfNoFame | 2nd Nov 23, 12:00pm 1698879648

Forget the statistically insignificant price movements.

The 'turn' is signaled by increasing sales volumes.

Are we seeing that? No? Yes? ;-)

by timbob | 2nd Nov 23, 12:16pm 1698880587

I'm seeing prices back up to the peak of 2021 now, Interest rates are not restricting buyers. This one : https://homes.co.nz/address/christchurch/ilam/18-coldstream-court/eVq18W sold for 975k this morning.