House sales volumes fell in April both year-on-year and compared with March, the Real Estate Institute of New Zealand (REINZ) says, and the national median house price also dropped despite a new all time high in Auckland.
REINZ said 4,987 houses sold in April this year, down from 5,848 in March and down 220 or 4% from 5,207 in April 2010. The national average days to sell was unchanged in April from March at 43 but up from 40 in April 2010.
The national median house price fell by NZ$5,000 to NZ$360,000 from March, but was up NZ$4,000 compared with April 2010.
“The April results reflect a steady market across New Zealand with signs of a lift in prices in the South Island, and Auckland prices still solid with limited supply ,” said REINZ chief executive Helen O’Sullivan.
“Volumes across the country were stronger than we expected on a seasonally adjusted basis, with only Manawatu / Whanganui and Wellington showing negative volume movements. The results reflect some cautious optimism with no great outbreak of smiles but certainly fewer frowns.”
The Auckland region recorded a new all time high median house price in April of NZ$479,500 topping the previous high of NZ$477,000 recorded last November. The average days to sell in Auckland dropped to 34 from 35 in both March and April last year. Auckland sales volumes rose to 1,854 from 1,768 in April last year, but were down from 2,437 in March.
“Auckland continues to lead the overall market in terms of price, with prices rising 2% compared to March and up 2% compared to April 2010," O'Sullivan said.
Sales volumes in Christchurch City increased a bit in April to 315 from 193 in March, but still well short of the 511 sales recorded n April 2010.
"While still a long way from previous activity levels, this indicates that the market is finding its way to a 'new normal'," O'Sullivan said.
The median price in Christchurch City increased by almost 5% compared with March, and increased 1.5% compared with April last year.
Prices in the South Island generally showed some strength in April compared with the previous month, she said, with Otago recording a 9.3% increase, Central Otago Lakes 8.2% and Canterbury/Westland 6.9%.
"On a seasonally adjusted basis Central Otago Lakes and Otago recorded the strongest lifts in volumes in April compared to March 2011, although the 72% lift in Canterbury/Westland’s volumes reflected both the extraordinarily low March and an easing of previous difficulties in obtaining insurance in this market," O’Sullivan said.
Across the country all regions other than Wellington, Southland and Nelson/Marlborough recorded a decrease in days to sell. Northland remained the region with the longest number of days to sell at 73 days; however, this is a 21 day improvement over the March 2011 measure of 94 days.
JP Morgan economist Helen Kevans suggested there was "limited upside" to house prices in the short-term with households continuing to shy away from taking on additional debt.
"Indeed, the clearest indication of continued caution among buyers is the large number of days it is taking to sell a house. Furthermore, the slow pace of home sales have kept inventory levels elevated, such that the backlog of unsold property sitting on the market will depress house prices further, as will the elevated level of house prices relative to household incomes," said Kevans.
(Updates add further detail including Helen Kevans' comments).