Property Market Update - July 2023
Andrew North, filling in for Rob Carter, with the July market update for the North Shore, Rodney and Waitākere markets.
The low stock levels that Rob talked about last month continue to be a factor driving buyers, particularly first-time home buyers who have been hesitant but now seem to be growing tired of waiting… they are now active.
Economist Tony Alexander talks about FOOP or fear of over paying exiting the market, with buyers and their behaviour suggesting we have left the bottom of the market, and if they don’t engage they could be faced with higher prices post-election.
The cost of money is still keeping the market in check, creating one of the most balanced markets I personally have ever seen. Translating this further, I see us entering an ‘opportunity for everyone’ market, where you can sell well and equally still buy well.
North Shore sees a median price of $1,212,000 up a modicum on the prior month. With the median days to sell also down by 6 days to 39. Sales volumes are up 11% to 240 – still well below traditional averages so we are not getting too excited just yet.
Rodney median price is sitting at $1,182,000 up a slight 2.8% on the prior month. However of interest, it took 13 days longer to sell in July up to 66. But the sales volume was up 46.7%…that’s 46.7% of 176 transaction.
Out west in the wonderful Waitākeres the median sale price was up 1% to $900,000. Days to sell taking 10 days longer at 52. But again volume of sales is up 6.9%…let’s call it 7% to 249.
In summary, it would appear that the recovery is underway. The first home buyer market is very active, and of course, that is where we see the cycle begin.
Rob will be back next month with the August data, which if I was a gambling man, would be predicting more of what we have seen in July.
Property Market Update - June 2023
June’s month of month price increase here on the North Shore was the first notable increase in 12 months – another indicator the market has passed the bottom of the cycle.
As buyers rapidly return to the market, the increase in sales is eating into current stock volumes.
The urgency amongst buyers has been evident with Open home attendance up and auction rooms over-flowing.
This surge in activity combined with reduced stock levels will continue to place upward pressure on prices.
Inflation has fallen to its lowest levels since late 2021, yet at 6% still more than its target band, meaning the OCR will likely need to remain high for an extended period. It is however another data point heading in the right direction for a return to sustainable growth in house prices.
Despite being mid-Winter the market reaction to the changing climate is evident and a renewed level of activity emerging.
Property Market Update - May 2023
Recent weeks have seen a consistent flow of commentary acknowledging the market is gaining strength.
Taking a closer look at prices the North Shore median sale price declined significantly from July 2022 to March this year, over 18% down. Since March prices have stabilised with marginal change over the past 3 months.
There is a surge in activity from determined buyers, particularly notable at auctions. This is supported by easing lending criteria and amplified with the current restricted levels of available listings.
This stabilisation of prices, along with increasing auction success rates and the reserve banks assertion that the OCR has now peaked are all assisting in providing reassurance for kiwi’s (and a growing number of migrants) to have confidence in the market moving forward.
As confidence rebuilds the market will continue to navigate some headwinds provided by traditional Winter trading volumes and the upcoming election in October.
As we move past the shortest day of the year, it is glaringly apparent that brighter days are ahead for the property market.
Property Market Update - April 2023
Over the past month it’s been about the impact of interest rates, immigration & inflation, and the influence they will have on the property market. The question is ‘Has the market bottomed out?’
Well, if the best predictor of future behaviour is past behaviour, then given the data on significantly increasing immigration it is worthy to review the correlation that immigration and property prices have had in the past.
Net immigration for the year to March is now sitting at over 65,000 compared to a net loss of nearly 20,000 in the previous year…. forecasts are for this to grow to a net inflow of 100,000 people this year – this would be the fastest rate of population growth New Zealand has seen in decades.
As can be seen the increased demand for housing from immigration has in the past put upward pressure on prices. Whilst it is generally a ‘lagged relationship’ looking forward it would be sensible to assume this rapidly growing immigration (resulting in the increased demand for housing), at a time when new supply is slowing is again likely to result in increasing property prices.
Despite subdued sales volumes in April there is undoubtedly growing momentum in the market, first home buyers are more active, they’ve been assisted by the reserve banks announcement on easing LVR restrictions. Our auction room last week was overflowing and reports of good properties having large numbers of inspections.
So, has the market bottomed out? We wont know until we have passed the point! As buyers analyse if inflation & interest rates have peaked, be cautious of the impact of immigration and closely consider the current conditions, with lower prices and a reasonable volume of listings there are strong indicators that for astute buyers it is the time to act.
Please reach out to one of Harcourts Cooper & Co’s 350 sales consultants to discuss your property decisions.