Much like the spate of seasonal stormy weather we’ve experienced, the general media would have you believe the property market has been stuck in its own version of doom and gloom.
Up until the peak, near the end of 2021, house prices had skyrocketed over an 18month period, climbing over 45% (May 2020 – November 2021). Since then, domestically, we’ve had the CCCFA changes, re-introduction of LVR restrictions, and removal of interest tax deductibility for investors. Across the wider economy that’s been underpinned by global uncertainty relating to covid, the war in Ukraine and the general climbing of supply-chain affected cost structures. The subsequent, but consistent interest rate increases implemented to curb inflation have all stifled the ability, capacity and confidence for buyers to borrow and purchase. Overall, this has led to property sales volumes declining since July 2021.
Whilst sales volumes have declined, down almost 54% across Rodney in July 2022 versus July 2021 (106 v 230), we’ve seen the number of properties available for sale increase significantly. This is partly due to houses now taking a lot longer to sell, with the average days on market for July blowing out to 53 days, some 19 days longer than in July last year. With New Zealand’s high employment rate and banks’ lending conservatism, we’re yet to see any discernible impact on homeowners’ ability to handle the impact of rising interest rates, and as such the market is not adrift with distressed vendors. However, the winds have certainly changed, and market dynamics have moved to favour buyers. Unlike last year, vendors are having to adjust their expectations in order to meet the market, but at the same time, that hasn’t led to a cataclysmic reduction on house values.
Across Rodney, the median price dipped slightly from $1.218 million in July last year to $1.2 million last month. But crucially, Rodney’s July 2020 median price was $930,000, indicating a 30% equity gain for those across the region who have owned property for more than 2 years.
And much like the transition to Spring, with days becoming noticeably longer and the bulk of the winter chills now in the rearview mirror, our agents across the region are witnessing a seasonal change in the property market, with renewed buyer confidence at the coalface. With the easing of the CCCFA and rates looking to peak, buyers are back out on weekends looking for their next home to purchase.
Right now, timing is everything so if you’re looking to potentially sell, you may want to list now and beat the first wave of Spring listings coming in mid-September. And even if you’re not looking to sell, but are generally interested to see what your home could be worth in today’s market, reach out today for a no obligation, confidential assessment from one of our highly skilled, and most trusted team.
