The housing market is feeling the effects of a cold, wet winter, rising mortgage rates and economic uncertainties with sales numbers and prices both taking a slide in June.
According to the Real Estate Institute of NZ (REINZ), 5996 residential properties were sold by its members in June, down 11.0% compared to May and -2.9% compared to June last year.
In Auckland, the country's largest real estate market, residential sales were -13.3% compared to May and -5.6% compared to June last year.
In the rest of the country excluding Auckland, sales were -10.0% compared to May and -1.7% compared to June last year.
Prices were also weaker, with the REINZ House Price Index (HPI), which is widely regarded as the most accurate indicator of house price movements, declining by 0.9% in June compared to May, -2.4% over the three months to June and -0.8% compared to June last year.
Of the REINZ's 12 sales districts, the HPI declined in eight districts in June compared to May and increased in four - the table below shows the HPI movements in all districts.
The national median selling price was $770,000 in June, down by 1.3% compared to May but up by 0.7% compared to June last year.
The REINZ's June report attributed the annual increase in the median price to "continued strength in some of the country's higher value and better performing regions."
"The New Zealand housing market has become a series of local markets moving at different speeds," REINZ Chief Executive Lizzy Ryley said.
"Buyers and sellers in one part of the country are having a very different experience from those in another, making the local knowledge of trusted real estate professionals more important than ever," she said.
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Volumes sold - REINZ
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Median price - REINZ
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31 Comments
A big cheer down South.
A higher cost of living is nothing to cheer about - lucky North Islanders seeing houses continue to get cheaper.
Buyers and sellers in one part of the country are having a very different experience from those in another
Indeed, most of the country is down, Canterbury, Otago and Southland all up over 4% yoy.
As is the cost of living.
Straws - clutching at thereof.
The trend was inevitably not going to be your friend at some point.
"...the capital recorded its longest median days to sell for the month of June since 1992,..."
https://www.stuff.co.nz/home-property/361006332/wellington-homes-taking…
Down down down in ponzi town continues. The drop around the east coast of the NI is severe, from Wellington via Hawkes Bay, BOP and up to Auckland. It tells a tale of overuse of leveraged speculation without thought for supporting income. If it was a wine clearance label, it would be "made to much" and sold as a white label discount, or "cancelled export order" aka no buyers.
Instead its "Paid to much".
Looking at the global economic tea leaves its a difficult case to be made to "hold on". And then there is all the noise this election cycle on... more tax inbound around realestate.
Excluding Akl, HPI up 0.5%. This market is turning north again. Auckland is very close, if not already turning north also.
Market is flat in nominal terms and has been for years - but continues to decline in real terms.
My view is status quo continues for a few more years yet - to where we see prices down 40-50% from peak in real terms.
OK, that's a pretty gloomy outlook. So 2029 could be the year to invest in property?
Perhaps you need to define 'invest'.
:)
Buy a house to live in, or to have as an investment.
Only gloomy if one is overweight property
Do you mean over-leveraged? Or just too much invested in Real Estate vs other investment options?
Only you know the answer to that as it is you in your situation who see’s house prices falling in real terms as ‘gloomy’. I don’t.
Self reflect and look at your portfolio and you’ll answer your own question.
I think you've called this early, but time will tell.
Maybe a reasonable point to buy for a FHB who wants a place to live for a good few years, hard to imagine anyone else looking at the investable universe and deciding that NZ property is the best of the bunch though.
So that leaves what, the share market? I reckon that's a bubble about to burst.
It's all a bubble, waiting to burst.
Your question is therefore wrongly framed - in that it assumes a valid alternative and assumes the continued validity of the proxy.
Which bit of it do you think is a bubble? It's cheap and easy to buy any sector in any country these days. Don't think of it as a monolithic 'share market' - it's the way for normal people to buy parts of real businesses anywhere in the world.
Yes, you make a good point. The share market is a good long-term play and I have cash there also. However, it's not for the faint-hearted and could be tough going in the next few years if you're risk-on.
Risk is relative, I guess. This article is about a property market where participants routinely borrow 60-80% of the purchase price and where some cities have dropped 20-30% over the last few years.
You have to be a truly terrible share investor to lose all your money, in property you just had to be a regular FHB in Auckland or Wellington a few years back.
They will only be terrible property investors if they choose to sell now, which is the worst time to do so IMO. Long term, they will be fine.
Obviously you need to believe that.
Yes, I do believe it, otherwise I wouldn't be saying it.
Hi H, selling property yesterday, is probably the best decision, any Property Investor could make.
As the big NZ cities are now down -25 to -49%, in the only measure that counts, in REAL TERMS and still dropping beneath the waves, without trace.....selling today is only slightly less loss, than selling yesterday.
NZ PROPERTY:
This sucka is STILL going down.
For shorters.....this decade+++ NZ property downtrend, is your friend!
The choice is not always theirs.. especially when the money used to purchase the bulk of such an investment was never theirs.
Also, opportunity cost
You could choose certain sectors of the market and avoid others
ie Do not touch AI but get long biomeds or pharma
or just go towards Aussie infrastructure plays (good yield)
so many choices beyond bricks and morter
Good advice. Especially aussie infrastructure. Not so sure about Biomed/pharma. Isn't that a bit speculative or are you suggesting ETFs?
LNG being ramped up in the Pilbara in Oz currently.
ie Do not touch AI but get long biomeds or pharma
AI-related stocks have been superb investments and many data center stocks already seen large corrections. But more a 2024 entry asset than 2026.
IBM falling 25% overnight was an indicator of where we're at.
Agree but I do not chase the Dragon, that's like Hamish saying property investment has done well over the last 20 years...
Sure AI has done well, and AI is amazing and will continue to improve, will AI companies and there amazing investments do well?
yet to see,
Reckons
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