Confidence from sellers, and buyers warming up

As this issue went to press in late February, the Real Estate Institute of New Zealand (REINZ) had released their data for January 2024, showing slower sales and a significant increase in the number of property listings available. This shows confidence from sellers, while warming up buyers with a greater choice of property to choose from.

“January is usually a slower month for the completion of sales in New Zealand and this year is no exception with 2,995 properties being sold,” commented REINZ CEO Jen Baird in her January report. "While this is 4.9% more than January 2023, the increase in listings is a stronger indicator that the market continues to pick up. Listings increased by 10.4% nationally, and by 5.4% for New Zealand (excluding Auckland), year-on-year. The biggest increases in listings compared with the previous month were seen in Wellington at 148%, followed by Gisborne at 84%, Canterbury at 81%, and Auckland at 76.8%.
"The national median sale price has slightly decreased from December 2023, down 2.5% from $779,830 to $760,000. Year-on-year, there is a slight decrease in the national median price by 0.7% from $765,000 to $760,000, while New Zealand (excluding Auckland), is down by 2.1% month-on-month (from $700,000 to $685,000), and up year-on-year by 0.8% (from $680,000 to $685,000).
“The data shows regional variation in median sale prices, with Northland topping the scale with a 21% increase month-on-month from $630,000 to $762,000, and a 10.8% increase year-on-year from $687,500 to $762,000. Meanwhile, Auckland’s median sale price has fallen under the $1 million mark again this month, for the fifth time in a year, to $975,000. However, this is still 3.4% more than a year ago.
“Despite the wave of listings favouring buyers, the challenges of last year, including the cost of living, inflation, interest rate changes, and government reforms, mean some buyers remain cautious. However, most regions are reporting more buyer activity across the board, with some seeing a particular surge in first-home buyer interest. Vendors are also being confident but realistic with prices as activity increases over the summer months. This is likely to resolve in inventory moving over the coming more active months in the year.
"One area of significant change that has widespread support across the property sector is the Residential Property Managers' Bill. This regulation provides much-needed structure to a sector that collects rent from 670,000 tenants and manages billions of dollars in assets for everyday New Zealanders. As disincentives are removed, this is important regulation to monitor as it may change market activity, inviting investors back or to refresh their portfolios, making more housing available for those who are not in the market.
“2024 is shaping up to deliver a series of changes and shifts in dynamics for the market. The property sector is expecting the new government to make good on its promises to reduce the bright line back to two years and reintroduce interest deductibility on investment properties, changing the dynamics of the property market again.”
January is obviously one of the lighter months of the year for house sales. 126 houses were sold on the North Shore in January, down from 139 in January 2023. The median house price in January 2024 for the North Shore was $1,161,260, down from $1,220,000 in December 2023 and $1,225,000 in January 2023, 12 months ago.
Local real estate offices report strong sales in February and there is clearly an increase in listings for the busy selling months of March and April.