By Bernard Hickey
New listings on Realestate.co.nz rose 58% to 13,459 in February from January as home sellers sensed a turning of the market and leapt on to the website with record high asking prices.
"The New Zealand property market is finally responding to the ongoing demand for homes," said Realestate.co.nz CEO Alistair Helm in the monthly listings report. (See our video interview above and see the full report on unconditional.co.nz).
New listings were up 18% in February from a year ago and were up 14% in seasonally adjusted terms from January. The seasonally adjusted mean asking price in February was a record high NZ$426,575, up 2% from January and up 3% from a year ago.
Helm said the concurrent rise in new listings and asking prices indicated sellers were finally responding to the ongoing high demand for property.
“Since the demand for property has not slowed, it’s almost surprising that we have not seen the increase in asking price until now. However, with sales continuing to remain strong and inventory falling yet again in February to 36 weeks, sellers are clearly raising their expectations," Helm said.
Inventory, measured as the number of weeks of sales in seasonally adjusted terms, fell to 36 weeks nationally from 36.4 weeks in January and was down from 37.5 weeks in February a year ago. It remains below the 41 week long term average, which realestate.co.nz says indicates a 'sellers market'
There were record high asking prices in Canterbury and the Central North Island. There was 24 weeks of inventory in Auckland, below the 33 weeks average. But there was 234 weeks of inventory in Coromandel, above its 198 week average.Wellington inventory was at 22 weeks, below its 23 weeks average.
'Market in favour of sellers'
“We are seeing the market find some level ground in many regions, as they edge closer to the long term average of 41 weeks of inventory. This suggested there is a better balance returning to the market in some areas. However, shortages are persisting in the major cities of Auckland, Wellington and Christchurch," Helm said.
Helm says that these pockets of shortages will most likely continue to prompt more sellers to list in the coming months, while the market clearly remains in their favour.
ASB comments
ASB's economists said the figures suggested the housing market may be starting to respond tight conditions.
"House prices have started to rise in areas where the housing market has become very tight, and this appears to be have enticed potential sellers to list," they said.
"Nonetheless, the level of new listings still remains very low. Total inventory levels on the housing market only just increased (up 0.2%)," they said.
"This suggests the new listings have been snapped up quickly, with the increase in supply only just meeting demand. Overall, the housing market remains very tight, particularly in Auckland. We continue to expect house prices to rise over 2012 reflecting these supply shortages."
(Updated with ASB comments)
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