The housing market moved even further in buyers' favour in May with asking prices dropping for the third consecutive month and stock for sale at a 12 year high for the time of year, according to the latest data from Realestate.co.nz.
The property website had 36,130 residential properties advertised for sale at the end of May. That was up 5.0% compared to May last year, and was the most stock it has had on its books in the month of May since 2014.
Total stock for sale was particularly high in Auckland, where 14,261 residential properties were available for sale at the end of May, an 18 year high for the month of May.
Stock levels were up compared to a year ago in most parts of the country, with only four regions - West Coast, Southland, Central Otago/Lakes and Canterbury recording lower stock levels compared to May last year.
If stock levels follow their usual seasonal trend, they should decline slightly over the next few months, then begin picking up again as the market heads into the spring/summer selling season.
However, it appears that potential buyers will continue to have plenty of choice in the coming months.
They may also be able to negotiate cheaper prices.
The average asking price of the properties advertised for sale on Realestate.co.nz declined for the third consecutive month in May to $850,434.
The average asking price has now declined by $48,243 (-5.4%) since February.
Average asking prices in Auckland have suffered an even bigger decline, dropping to $1,012,963 in May, down $84,780 (-7.7%) since February.
However, the apparently softer market conditions have not resulted in fewer vendors bringing their properties to market, with Realestate.co.nz receiving 9521 new residential listings in May. That was the highest number for the month of May since 2018.
4 Comments
Its Fine.
The bottom of this market has yet to be found in the North Island, while the South Island is chugging along nicely.
Sellers remain deluded to commercial reality available to buyers. Interest rates still low compared to historically normal levels and are forecast to rise. Key point...
declined for the third consecutive month
Rents are dropping to boot. Yet rates, power, and other opex is all rising. Looks like specuvestors have become specusuckers. Aka the last bag holder.
Yip and every few months I hear news of another person I know in their 60-70’s who has died of cancer (oddly mostly men…) leaving a widow in an oversized property they will need to list and downsize from at some point in the near future.
Unless we see another huge wave of immigration (but into what jobs/industries here?) I see supply/demand imbalance putting downward pressure on prices for more than just a few more months or years (ie opposite pattern of the past 20-30 years). Could continue to get worse as more boomers die in the next 10-20 years- remember approximately 50% will be deceased in the next 10 years and they own a lot of property.
Most of these people I know who have died recently were affluent and living in large properties. I’m not sure where all the buyers are going to come from to buy their multimillion $ properties unless via inheritances etc. But if existing residents move into the large expensive houses boomers have been living in - who is going to live in the lower value housing that is vacated by current residents in that movement? Our birth rates are low.
Can see big shifts in market dynamics at play. The baby boom empire of expensive housing, offshoring jobs to foreign countries to maximise shareholder profits, and importing cheap workers to do min-wage jobs and be tenants for their rental portfolios while simultaneously relying on falling interest rates to reduce mortgage expenses with property prices rising twice the rate of general inflation (average of 7% for the 3-4 decades with a CPI of half of that), is crumbling now - past their peak- to be replaced by what is the important question.
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