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House sales creep up from trough, still in the doldrums

Thursday 14th October 2010

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New Zealand's residential house sales crept up in September from August's trough, though they're still in the doldrums as people continue to focus on repaying debt.

Sales rose to 4,323 in September from 4,287 a month earlier, and are down by about a third from the same month a year ago, according to Real Estate Institute of New Zealand data. August sales were just 67 ahead of a trough in the same month in 2008, though 15% more than the record-low in January. The median sale price held at $350,000 on both a month-on-month and year-on-year basis.

"Sales continue to remain very subdued across the country, but some of this could be attributed to uncertainty over the rise in GST and tax cuts, which came into effect on 1 October and also the shocking spring weather we have been experiencing," spokesman Bryan Thomson said in a statement.

"We would expect to see a pick-up in the market in coming months as warmer spring and summer weather generally brings an influx of new property listings on to the market providing more choice for buyers."

QV Valuations data last week showed New Zealand property values have been in decline for the past six months as people repay debt in favour of new spending. Adding to the downbeat sentiment in the property market has been a turnaround in the inflow of new migrants and returning expatriates looking for housing as Australia's economy dodged recession and offers people brighter prospects.

The median number of days to sell a house held at 43 days from August, and is up 10 days from September 2009.

The REINZ monthly housing price index, which was designed with the Reserve Bank to help flatten out volatility in sales prices, fell 0.3% to 3192.9 in September, and fell 1.2% on a rolling three-month basis. Prices are 1.3% below their September 2009 level and 5.6% short of the peak in November 2007.

The Auckland median price rose to $450,000 from $445,000 in August, and the number of sales increased to 1,690 from 1,487 month-on-month.

The Wellington median sale price gained to $398,500 from $397,500, with sales down to 492 from 501 in August.

The median sale price in Christchurch increased to $338,000 from $335,000 in August, with sales slumping to 237 from 416. The Canterbury region was hit by a 7.1 magnitude earthquake at the start of the month.

The Dunedin median price dropped to $242,000 from $245,000 in August, and sales rose to 147 from 145.

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