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Regional Commentary and Property Market Statistics - December 2019

Market Statistics

Property Brokers 17 Jan 2020

PB030482 - Regional Commentary & Property market Statistics 

The number of residential properties sold across New Zealand in December 2019 increased by 12.3% from the same time last year to 6,285 up from 5,596 (689 more properties).  

For New Zealand excluding Auckland, the number of properties sold increased by 5.8% when compared to the
same time last year (to 4,425 up from 4,184) – the highest for the month of December in 3 years.

Bindi Norwell, Chief Executive at REINZ says: “The property market had a solid end to the decade with a 12.3% increase in the number of properties sold in December 2019 when compared to December 2018. That’s an additional 22 houses sold each day around the country in December, which is not an insignificant number. With insufficient properties on the market to satisfy buyer demand, it suggests that buyers are
being more definitive when it comes to purchasing as they are aware of the need to move quickly on properties and areas with high demand. This is backed up by the decrease in the median number of days to sell which is at its lowest point for 3 years.

Four regions saw decreases in annual sales volumes during
December:

• West Coast: -43.5% (from 46 to 26 – 20 fewer houses) – the lowest since April 2017
• Gisborne: -18.5% (from 54 to 44 – 10 fewer houses) – the lowest for the month of December in 5 years
• Manawatu/Wanganui: -14.2% (from 351 to 301 – 50 fewer houses) – the lowest for the month of December in 5 years
• Hawke’s Bay: -1.4% (from 213 to 210 – 3 fewer houses).

“Looking around the country, 12 out of 16 regions saw annual increases in the number of properties sold – the highest number of annual increases in 3 months – with particularly strong increases in Auckland, the Bay of Plenty, Southland, Northland and Canterbury,” continues Norwell.

Regions outside Auckland with the highest percentage increase in annual sales volumes during December were:
• Bay of Plenty: +21.5% (from 414 to 503 – 89 more houses) – the highest for the month of December in 4 years
• Southland: +18.3% (from 126 to 149 – 23 more houses) – the highest for the month of December in 3 years
• Northland: +17.3% (from 173 to 203 – 30 more houses) – the highest for the month of December in 3 years
• Canterbury: +16.1% (from 776 to 901 – 125 more houses) – the highest for the month of December in 3 years.

Regional Analysis - Auckland

“December saw the Auckland market finish 2019 with a median price of $890,000, just $10,000 off the record achieved in March 2017. Manukau City saw a record median price of $900,000, 33 months since its prior record back in March 2017. The REINZ House Price Index for Auckland also reached 2,931, up 4.0% year-on-year. There was increased sales activity at the end of the year with a significant 31.7% increase in properties sold year-on-year, recording the most December sales since 2015. Properties which had previously been on the market for a while were sold, which is a positive indication for what the start of 2020 might bring. First home buyers continue to be interested in the Franklin and South Auckland areas, which features some of the most affordable properties in Auckland. First home buyers remain active in auction rooms where there have been strong clearance rates. Low interest rates continue to create more activity in the market. However, banks are still being tough with lending and have high demands for proof of repayments. We are starting to see a shift in “Baby Boomers” who are looking to downsize or even enter retirement accommodation. Investors have largely left the market in Rodney, which has likely caused a shortage in rental housing. Although, there are still a few investors looking around for investments in popular holiday hotspots. In other parts of the region, we have started to see some investors returning to the market as they perceive house prices will continue to increase in 2020. As we enter the New Year, we expect to see more competition at auctions and hopefully more listings coming onto the market with vendors looking to take advantage of their capital gains.” (REINZ)

The current Days to Sell of 34 days is above the 10-year average for December which is 33 days. The level of inventory available for sale currently sits at 17 weeks, five weeks less than in December 2018.

Auckland-2019 

Regional Analysis - Northland

“The Northland market remained confident with prices up a strong 12.3% year-on-year to a record high of $539,000 and a record median for the Whangarei District of $580,000. There has been an uplift in the number of out of town enquiries and we are now seeing a 50/50 split in some areas between local and out of town buyers looking for permanent homes and rental investments. However, there has been the typical drop off in the number of people attending open homes due to the holiday period. First home buyers are now starting to struggle to meet the criteria to receive the KiwiSaver HomeStart grant because of the increase in house prices being above the regional house price cap. Sales in the region have been strong with a 17.3% increase compared to the same time last year. We expect sales to remain steady and vendor price expectations will continue to be strong. We should also start to see more listings come onto the market through to late summer, whilst demand for properties across all price ranges will persist.” (REINZ)

The current Days to Sell of 45 days is less than the 10-year average for December which is 53 days. The level of inventory available for sale currently sits at 43 weeks, 12 weeks more than in December 2018.

Northland-2019

Regional Analysis - Waikato

“The Waikato region saw the median price increase 9.0% to $577,500 compared to December 2018. Additionally, the Taupo and Waitomo Districts experienced record median prices. The REINZ House Price Index for the Waikato region reached a new record high of 3,152, up 9.8% compared to the same time last year. On the flipside, the number of new listings in the Waikato dropped 15.1%, and in the Central North Island new listings dropped 29.2%, the largest decrease in new listings in the North Island compared to December 2018. In Taupo, this time of the year is always quiet due to the holiday season, although the number of enquires has been steady. New Capital Values have been issued in Taupo, and in most cases they are similar to the market value. On the other hand, there has been an increase in activity in the Thames/ Coromandel area likely due to the busy holiday period, but the increase in sales has started earlier than in previous years. There is good activity from investors throughout the region due to good lending options. There is a continued positive reaction from purchasers and we should expect to see similar results in 2020, as we did in 2019.” (REINZ)

The current Days to Sell of 30 days is less than the 10-year average for December which is 39 days. The level of inventory available for sale currently sits at 13 weeks, three weeks less than in December 2018.

 

Waikato-2019

Regional Analysis - Bay of Plenty

“The Bay of Plenty region experienced a 4.1% increase in the median price year-on-year, which has closely followed the activity from last month with the median price only dropping slightly from $636,000 to $635,000. Tauranga City also experienced a record median price of $710,000. The holiday period hasn’t affected sales volumes, with 503 sales in December, a positive 21.5% increase compared to December 2018 and the most December sales since December 2015. There has been a slight decrease in the number of first home buyers in the market compared to last month, however, overall there continues to be a steady number of local buyers attending open homes looking for their next permanent home. Low term deposits have pushed investors to look elsewhere for alternative investments and property is seen as a better performer. The market continues to perform well across all price brackets and property types. Buyers tend to be spread across the market with marginally more activity within in the middle to lower end price brackets.” (REINZ)

 

The current Days to Sell of 37 days is less than the 10-year average for December which is 46 days. The level of inventory available for sale currently sits at 13 weeks, one week less than in December 2018.

BOP-2019

 

Regional Analysis - Gisborne

“The median price in Gisborne crept over the $400,000 mark reaching $410,000, a 21.3% increase compared to the same time last year. The increase is likely due to the lack of supply contributing to the demand. This is reflected in the decrease in the number of properties sold in the sub $250,000 price bracket dropping from 22.22% in December 2018 to 6.82% in December 2019. The number of new listings that came onto the market (30) was the same as December 2018. In December, Gisborne had 5 weeks’ of inventory available, the equal lowest inventory available in the region since records began. There are many first home buyers still active in the market, but investor activity has decreased compared to last month. In saying that, many buyers are at the higher end of the market due to the lack of affordable houses, with around 30% more cash buyers who are prepared to make a purchase, which is likely to be contributing to the competitive nature of the current market. Over the next few months we should expect more listings to come onto the market, but prices should stay relatively the same.” (REINZ)

 

The current Days to Sell of 31 days is less than the 10-year average for December which is 36 days. The level of inventory available for sale currently sits at 5 weeks (the lowest of all the regions), the same as in December 2018.

Gisborne-2019

Regional Analysis - Hawke's Bay

“In December, The Hawke’s Bay region experienced a 14.5% increase in the median price, reaching $520,000. Record median prices were achieved in Central Hawke’s Bay District and Napier City for the second month in a row. New listings in the region were positive (+0.4%), one of only two regions, along with the Wairarapa, that saw an increase in new listings compared to December 2018. The market continues to perform closely to last month, with a shortage of listings in the popular price brackets and locations around the region. The usual seasonal effect has meant there has been fewer buyers in the market and less attendees at open homes. However, we have seen a few out of town and overseas buyers enter the market this month, looking to buy in the region. Over the next few months we expect the market to tighten unless we see more listings come onto the market.” (REINZ)

 

The current Days to Sell of 27 days is much less than the 10-year average for December which is 39 days. The level of inventory available for sale currently sits at 7 weeks, one week less than in December 2018.

HBay-2019

Regional Analysis - Taranaki

“The Taranaki region continues to be strong with a record median price for the second month in a row, reaching $430,000. The New Plymouth District also experienced another record median price of $510,000, up from last month’s record median price of $473,000. Despite the median price increasing, the region saw a negative month-on-month REINZ House Price Index of -1.7%, indicating the median price increase is likely due to the type of property sold rather than the value itself. Sales numbers are up year-on-year by 4.5%, but overall, sales in December recorded the lowest number of sales in the region throughout 2019. New listings also dropped -26.6% from 188 to 138 compared to the same time last year. The continued lack of listings has likely caused an increase in vendor price expectations. Buyers are becoming frustrated when competing in multi offers and miss out due to the number of offers presented. In saying that, attendees at open homes have remained steady. Investors are still very active in the market and this month we have seen a couple of overseas buyers showing interest in the region.” (REINZ)

 

The current Days to Sell of 26 days is much less than the 10-year average for December which is 37 days. The level of inventory available for sale currently sits at 14 weeks, the same as in December 2018.

Taranaki-2019

Regional Analysis - Manawatu/Whanganui

“Not surprisingly, the Manawatu/Wanganui market achieved another record median price of $402,500, after experiencing a record or equal record median price every month in 2019. Additionally, both Manawatu District and Palmerston North City also experienced record median house prices. The REINZ House Price Index for the region reached a new record high of 3,408, up 19.2% annually. Subsequently, vendor price expectations have steadily increased as prices continue to increase. On the flipside, sales were down -14.2% compared to December 2018. Interestingly, the number of sales (301) were recorded as the lowest for the month of December since December 2014. New listings also dropped -10.7% year-on-year. The drop in available properties on the market has likely been the result of a strong sales month in November, as well as some vendors removing their property from the market during the holiday period. The number of people attending open homes decreased especially towards the last two weeks of December. We are seeing fewer cash buyers compared to 12 months ago as many buyers want due diligence clauses in their contracts. Over the next few months, we expect strong buyer demand to continue, especially with the lack of properties available.” (REINZ)

 

The current Days to Sell of 27 days is much less than the 10-year average for December which is 37 days. The level of inventory available for sale currently sits at 9 weeks, one week less than in December 2018.

Manawatu-2019

Regional Analysis - Wellington

“In December, the Wellington region experienced a median price increase of 11.4% reaching $685,000 compared to December 2018. Additionally, the Kapiti Coast, Masterton District, Porirua City and South Wairarapa all achieved record median prices. With only 6 weeks’ inventory available, demand for properties continues to drive up prices. The price increase is also likely due to the increase in million dollar plus properties sold, increasing from 8.2% in December 2018 to 13.3% in December 2019. New listings in Wellington were down -9.2%, but the Wairarapa district saw a 1.1% annual increase in new listings. Properties continue to move quickly on and off the market, with days to sell decreasing from 29 days in December 2018 to 27 days in December 2019. Although there have been less attendees at open homes due to seasonal trends, there’s an increase in the number of out of town buyers attending and looking for potential holiday homes. A modest number of investors have also been active in the market searching for properties due to the large rental demand and lack of rentals available, especially in Central Wellington. Over the coming weeks we expect the market to stay relatively the same with the prospect of more listings which are likely to sell quickly.”(REINZ)

 

The current Days to Sell of 27 days is less than the 10-year average for December of 30 days. The level of inventory available for sale currently sits at six weeks, the same as in December 2018.

Wellington-2019

Regional Analysis - Nelson/Marlborough

“The Nelson/Marlborough/Tasman region finished the year positively with median price increases across all districts, particularly with Tasman achieving a record median price of $655,000. Sales across the region were also up year-on-year with Tasman recording the most December sales (76) since December 2007, and Nelson recording the most December sales (81) since December 2015. Days to sell was significantly down for both Tasman and Marlborough, indicating properties are not lasting long on the market. The overall interest in the region continues, but first home buyers and investors are fewer in numbers in Tasman and Marlborough and market activity has been quiet as expected for this time of the year. There are still a few investors active in the Nelson region who are looking to the higher price brackets as there is less competition amongst first home buyers. There is a consistent number of first home buyers in the Nelson area, however, they are still finding it hard to enter the market as it continues to be competitive and low on listings. Buyer demand continues to contribute to the increase in vendor price expectations. Many vendors are also looking to their rateable values to guide their asking price expectations. The market will continue to remain positive over the next few weeks, driven by both local and out of town interest.” (REINZ)

 

The current Days to Sell of 29 days is less than the 10-year average for December which is 33 days. The level of inventory available for sale currently sits at 12.5 weeks, the less than in December 2018.

Nelson-2019

Regional Analysis - West Coast

“West Coast was the only region that experienced an annual decrease in median price dropping 13.6% to $190,000, likely a result of the increase in properties in the sub $250,000 price bracket. Sales also fell 43.5% from 46 in December 2018 to 26 in December 2019, recording the lowest number of sales since April 2017. Additionally, new listings decreased annually by -29.5%, the lowest in the country. On the flipside, days to sell decreased 35 days to 41 days in December 2019. While the West Coast market fluctuates and can be very seasonal, there is an overall increase in interest in the region. The first home buyer market has been steady over the last couple of months, but we expect this to gather some momentum throughout 2020, especially as the reduction in first home buyer deposit takes effect. Reports of the local rental shortage has likely enticed more investor interest in the region; however, many are still cautious. Interest from retiree’s from outside the district is growing, likely due to the affordability and value for money that the region offers. The new Te Nīkau Grey Hospital and Health Centre which is due to be completed in the first quarter of 2020 is likely to be another draw card for the region. Buyers remain at the lower to middle end of the market. The market should remain steady over the coming months, with room for improvement in the value of the properties available.” (REINZ)

 

The current Days to Sell of 41 days is much less than the 10-year average for December which is 84 days. The level of inventory available for sale currently sits at 59 weeks, 12 weeks more than in December 2018.

West Coast-2019

Regional Analysis - Canterbury

“The Canterbury market remains stable with a 1.1% increase in median price reaching $460,000. Median prices are also up (+22.0%) in Ashburton to $360,000 compared to the same time last year. The market has continued to perform positively with both purchasers and vendors achieving reasonable prices. First home buyers continue to be a strong part of the Christchurch buyer pool and their presence in the market has increased over the last 12 months. There has also been a steady number of first home buyers in the Timaru area, however obtaining finance has been challenging due to the changes in lending criteria. A hailstorm in the Timaru region has caused delays in getting repairs done and people are needing to use cash deposits for excess payments. Once the insurance money comes in 2020, we expect a little surge of activity. More investors have been active in the market looking for property options that will provide higher financial returns compared to having their money in the bank. Interestingly, the number of attendees at open homes increased over the last month in the Christchurch area. Listing numbers have decreased slightly with new listings dropping 8.0% annually, but there was a seasonal burst at the start of the month followed by a drop off as we neared the Christmas period. Over the next couple of months, a busy market is expected with perhaps an increase in rental purchases.” (REINZ)

 

The current Days to Sell of 32 days is higher than the 10-year average for December which is 31 days. The level of inventory available for sale currently sits at 17 weeks, two weeks less than in December 2018.

Canterbury-2019

Regional Analysis - Otago

“Although the Queenstown-Lakes District experienced an annual decrease in the median price, dropping to $979,000, volumes increased 51% year-on-year. Towards the end of 2019, there were similar results compared to the rest of the year. A lack of listings is likely to be holding the market back, as buyer numbers and enquiry is strong. LVR rates are keeping first home buyers and investors in the market, but lending criteria is still making it hard for buyers. With the current lift in the Auckland market, we expect the Queenstown-Lakes to follow their lead as it does traditionally, especially Queenstown, with a lift in activity in early 2020. However, this is also dependent on more listings coming onto the market.” (REINZ)

 

“Dunedin City saw a lift in the median sale price, which is now sitting at $485,000, up from $420,000 in December 2018, while sales volumes are down from last December (-18.4%). The market continues to remain very buoyant and prices are expected to continue to rise. We are seeing many expats returning and entirely new purchasers being attracted to the city. Building activity has also started at the hospital which is attracting engineers and architects. Student enrolments are up, interest rates are low and Dunedin is seen as being very desirable as a place to live and bring up a family. The increasing popularity of Dunedin is likely to be pushing up prices in the region. Over the next few months we expect to see an active market which is indicated from the number of prospective buyers and sellers who have enquired over the festive season.” (REINZ)

 

The current Days to Sell of 28 days is less than the 10-year average for December which is 32 days. The level of inventory available for sale currently sits at 17 weeks, 9 weeks more than in December 2018.

Otago-2019

Regional Analysis - Southland

“The Southland market has been relatively busy this year and has ended on a high, recording a 32% increase in the median price from $250,000 in December 2018 to a record median price of $330,000 in December 2019. Invercargill City also achieved a record price of $336,000 up 1.2% on last months’ record. Buyers continue to be prevalent in the lower end of the market with some resistance in the middle to upper end. However, the number of properties sold in the sub $250,000 price bracket decreased significantly from 48.41% in December 2018 to 19.46% in December 2019. There is some concern locally around the threat of closure to the Tiwai Aluminium smelter in Bluff employing over 900 Southlanders, which could see house prices drop if the closure goes ahead. Southland continues to be the region with the lowest number of days to sell, currently at 21 which is a positive indicator going into 2020. Additionally, The REINZ House Price Index for the region reached a new record high of 3,292, up 20.6% annually, the highest annual increase throughout the country.” (REINZ)

 

The current Days to Sell of 21 days is much less than the 10-year average for December which is 33 days. The level of inventory available for sale currently sits at 10 weeks, six weeks less than in December 2018.

Southland-2019