NZ house sales still in slump, REINZ holds breath until November

Thursday 11th November 2010

New Zealand’s residential house sales resumed their slide last month as potential buyers continue to hold off from re-entering the market as households focus on repaying debt.

Sales dropped to 3,903 in October from 4,323 a month earlier, and are more than a third lower than the same month a year ago, according to the Real Estate Institute. That’s only the third time sales have dropped below 4,000 over the past 20 years, with the last two January months reporting record low volumes. The median sale price held at $350,000 for a third month, and is down 1.4% from October 2009.

“The usual spring influx of listings has been late this year, but activity is picking up now and the November figures should be better,” spokesman Peter Thompson said in a statement. “People planning to change houses appear to have held back on listing their current homes until they see what else is available and how the market is moving.”

Property values extended their decline for a seventh straight month according to QV Valuations data, and are 5.5% below the market peak in November 2007. The property market has stayed in the doldrums as households focus on repaying debt while interest rates stay low, holding back the country’s economic recovery as people refrain from spending.

The median number of days to sell shortened to 41 last month from 43 days in September, but is still 10 days longer than the same month a year ago.

The REINZ monthly housing index, which was developed with the Reserve Bank to help flatten out volatility in sales prices, fell 0.9% to 3161.5 last month, and dropped 0.8% over a rolling three-month period. On an annual basis, prices fell 3.5%, and are 6.5% below the November peak.

The Auckland median price rose to $460,000 from $450,000 in September, and the number of sales dropped to 1,360 from 1,690 month-on-month.

The Wellington median sale price fell to $390,336 from $398,500, with sales up to 496 from 492 in September.

The median sale price in Christchurch held at $338,000, with sales rising to 343 from 237 a month earlier. The Canterbury region was hit by a 7.1 magnitude earthquake at the start of September.

The Dunedin median price gained to $259,500 from $242,000 in September, and sales rose to 150 from 147.

Businesswire.co.nz

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