The number of properties sold in May across New Zealand decreased by 46.6% from the same time last year – from 7,477 to 3,990 – as Alert Level 3 restrictions on the real estate market still made it difficult for property sales to occur, according to the latest data from the Real Estate Institute of New Zealand (REINZ), source of the most complete and accurate real estate data in New Zealand.
For New Zealand excluding Auckland, the number of properties sold decreased by -47.4% when compared to the same time last year (from 5,464 to 2,873).
Bindi Norwell, Chief Executive at REINZ says: “The number of residential properties sold across New Zealand decreased by 46.6% in May when compared to the same time last year which is not surprising given we had the Alert Level 3 restrictions for the first 12 days of May
These restrictions meant only two property viewings, per property, per day were allowed, making it difficult to get interested parties through a property in a timely and efficient manner.
“With the Government initially wanting to restrict private viewings in Level 3, this would have had an even greater financial impact on people wanting to buy and sell property. So, we are pleased that some real estate activity was able to go ahead, thereby starting to get the market returning to a sense of normality more quickly,” continues Norwell
“In a positive sign, there has been a good uplift in sales activity as we moved from April to May, with 15 out of 16 regions across the country seeing triple figure percentage increases in their month-on-month sales activity. The only exception was Auckland, but the city did still see a 98.8% increase when compared to April,” she continues.
“We’re still seeing a shortage of new listings come to the market which continues to impact sales volumes. Hopefully, as people’s confidence starts to lift as we move through the Alert Level systems the listings shortage will start to change.
Regions with the largest decrease in annual sales volumes during May were:
• Tasman: -62.5% (from 80 to 30 – 50 fewer houses)
• Otago: -56.2% (from 479 to 210 – 269 fewer houses)
• Southland: -54.8% (from 210 to 95 – 115 fewer houses)
• Marlborough: -54.3% (from 105 to 48 – 57 fewer houses).
Record median prices were recorded in:
•Waikato with a 9.5% increase to $598,000 up from $546,000 at the same time last year
• Taranaki with a 16.7% increase to $426,000 up from $365,000 at the same time last year – just $1,000 higher than the previous record median set in March this year
• Tasman with a 19.9% increase to $701,500 up from $585,000 at the same time last year.
Regional Analysis - Auckland
“The Auckland market has remained stable with a median price of $910,000, up 7.1% year-on-year, and an increase across all Districts except Rodney District, which dropped from $899,000 in May 2019 to $885,000 in May 2020. Days to sell increased by 16 days from 45 days in May 2019 to 61 days in May 2020, likely the result of many of the sales in May that were listed prior to lockdown in March. There are increased numbers of qualified buyers attending open homes and auctions with several parties attending per property. Interestingly, there has been a lot of interest in new builds amongst first home buyers for properties under $1,000,000 in areas such as New Lynn and Ellerslie. Investor activity has increased in the market with some seeing an opportunity to increase their property portfolio, especially with low interest rates. There has been a few more sales in the $2,000,000+ price range as vendors make decisions around down-sizing and freeing up money to support their businesses. Market activity should continue to be steady over the next month or two before the normal winter slow down.” (REINZ)
The current Days to Sell of 61 days is much higher than the 10-year average for May which is 38 days.
Regional Analysis - Northland
“In May, the Northland region saw median prices increase by 14% to $530,000 and have remained fairly similar to pre-lockdown prices with a 4.1% increase since April. It has been an active market post lockdown with strong enquiries from both first home buyers and investors. There has also been more interest from out of town buyers compared to pre-lockdown. More listings have come onto the market in the past couple of weeks (a 304% uplift since April) with open homes becoming busy once again. Over the coming months the market should be steady as we head into the election months followed by more market activity and stock on the market as mortgage holidays come to an end.” (REINZ)
The current Days to Sell of 63 days is higher than the 10-year average for May which is 59 days.
Regional Analysis - Waikato
“The Waikato region experienced a record median price of $598,000, just shy of the $600,000 mark. Median prices increased in all areas except the Taupo District (-2.0%), which is likely to have contributed to the new record high. Record prices were achieved in Hamilton City ($645,000) and Matamata-Piako District ($585,000). However, the strongest growth came from the Waipa District which saw a 19.7% increase year-on-year to record price of $700,000. There is a healthy level of buyer enquiry with lots of investor enquiries but not as many sales with many hopeful that prices will drop in the coming weeks, although there are a few signs this will actually happen. Some opportunist buyers are making low offers on properties; however, vendors are generally appearing confident and staying the course given the imbalance between supply and demand. There are few instances of deals falling over due to declined finance approvals with banks being stricter with lending conditions. The number of buyers in the market outweighs the number of listings on the market evidenced by multi offers with many exceeding asking prices.” (REINZ)
The current Days to Sell of 59 days is much higher than the 10-year average for May which is 49 days.
Regional Analysis - Bay of Plenty
“Median prices in the Bay of Plenty reached $620,000, up 4.2% compared to the same time last year, but were down 1.6% on April. Te Papa/Welcome Bay and Katikati/Waihi Beach were the only areas to see price lifts since April. Overall, the market is busy with new listings, enquiries and plenty of buyers. Vendors are looking at all offers presented as no one is sure how the market will track over the coming months. It will be interesting to see how the market performs once election time begins, mortgage holidays end as well as the impact from the next wave of job losses.” (REINZ)
The current Days to Sell of 62 days is higher than the 10-year average for May which is 53 days.
Regional Analysis - Gisborne
“In May, Gisborne saw median prices decrease 5.7% year-on-year to $415,000, the only region to see an annual decrease, however prices increased 3.8% month-on-month. There has been an increase in the number of attendees at open homes which is a good indication of market activity. There is also a mix of people and property types being sold such as ‘lock up and leave’ holiday homes, young families selling their family home to upgrade, or units within a complex. The weather plays a big part in selling homes in the region and the weather has been favourable so there is a positive buzz amongst both vendors and buyers. Over the coming months, there may be continued activity pushing into the usually quieter winter months, due to losing a couple of months from the lockdown period.” (REINZ)
The current Days to Sell of 64 days is higher than the 10-year average for May which is 39 days
Regional Analysis - Hawke's Bay
“The Hawke’s Bay saw price increases in most areas across the region showing strength in the market. The median price rose by 16.0% reaching $545,041 compared to this time last year. Additionally, the REINZ House Price Index for Gisborne/ Hawke’s Bay region increased 16.6% year-on-year and it was one of only four regions to see appositive movement in the monthly HPI data. The market has been busier than usual with multi offers common with many sales negotiations. There is a mix of local first home buyers, investors and owner occupiers looking for houses in the mid to lower price ranges. Looking forward to the next few months it is expected that the market will remain steady with a low volume of new listings.” (REINZ)
The current Days to Sell of 56 days is much higher than the 10-year average for May which is 46 days
Regional Analysis - Taranaki
“The Taranaki market achieved a record median price of $426,000 in May. The number of houses sold in the $500,000+ price bracket increased by 10% compared to this time last year which has likely to have contributed to the new record median price. Taranaki also had the largest REINZ House Price Index increase (3.2%) from last month which suggests a good portion of price movement is being driven by a higher value per property. Low interest rates continue to bring about strong buyer interest from first home buyers generating multi offers on the lower to mid-priced properties. There has also been a noticeable increase in attendees at open homes driven by strong buyer demand and low listing stock. Demand for rental properties continues to be high with a lack of rentals available. The market will track fairly similarly over the coming months while demand continues to outweigh supply.”(REINZ)
The current Days to Sell of 56 days is more than the 10-year average for May which is 49 days.
Regional Analysis - Manawatu/Whanganui
“In May, the Manawatu-Wanganui region saw median prices increase 18.9% to $415,000. Additionally, the Tararua District achieved a new record median price of $300,000 – a $4,000 lift on the previous record set in January this year. The ManawatuWanganui appears to be the region least affected from a sales count perspective, with sales down 36.8% year-on-year. Many first home buyers have returned to the market post-lockdown, but they have had to check with their banks and lending institutions that they still qualify for finance. Banks have tightened their approval process for finance with some taking longer for approvals and many insisting on Registered Valuations and a lot more employment details to assess applicants’ job security. Attendance at open homes has been very good in the last few weeks with an average of 10 groups per open home. Vendors are hoping that the market retains the prices prior to lockdown which at this stage appears to be the case. Many properties are attracting multi offers in the first week that it is on the market. It is difficult to predict how the market will perform in the coming months; however, it is expected to remain steady.” (REINZ)
The current Days to Sell of 51 days is more than the 10-year average for May which is 47 days.
Regional Analysis - Wellington
“May saw prices in Wellington increase 9.3% to $677,510, echoing the strength of the region. Wellington City saw a median price record of $830,000, up from the last record of $820,000 achieved last year in October 2019. There have been a few investors who have made their way back into the market again looking for bargains, however, prices have been holding. First home buyers who have had pre-approvals prior to lockdown have a sense of urgency to purchase in case their pre-approvals expire, as they must start the process again. A few expats have started to register their interest and are looking to return home and buy in the region. Over the coming months it is expected to continue to remain busy and then slow down as we approach the typical winter months.” (REINZ)
The current Days to Sell of 55 days is much more than the 10-year average for May of 39 days.
Regional Analysis - Nelson/Marlborough
“Median prices in the Nelson/Marlborough/Tasman region all saw house prices increase with Tasman achieving a new record median price of $701,500. In saying that, Tasman had the second lowest number of sales (30) across all regions, with 60% of sales sitting in the $500,000 - $749,999 price bracket, which is likely to have pushed up the median price. Momentum is returning to similar levels pre-lockdown with more attendees at open homes and there is strong interest for the winter market ahead. There has not been signs of reduced-price expectations from vendors yet and the region remains active and positive with motivated vendors and purchasers. There is an indication that first home buyers are seeing the affordability of borrowing with the LVRs lifted versus renting. The entry level of first home buyers is also supporting the on flow of second and third home sales activity. Over the last four or five years, the winter market in the region has remained buoyant. The current supply and demand of new listings and buyer interest may be a good indicator of how the market will perform in June.” (REINZ)
The current Days to Sell of 58 days is much higher than the 10-year average for May which is 44 days.
Regional Analysis - West Coast
“The West Coast region experienced a 4.8% annual increase
in median prices reaching $220,000. The market surprised us in May with good levels of activity across all three Districts, however, sales count was the lowest (29 sales) in 5 years. New listings increased 2% annually, one of only two regions to see an increase in new listings, alongside Central Otago/Lakes. There was a wide variety of interest from a mix of buyers including considerable offshore interest, with hopeful buyers looking to move on from their old normal and take up residence in the West Coast. Prices remain strong and, so far, all signs are pointing to a continuation of market strength for the near future.” (REINZ)
The current Days to Sell of 54 days is much less than the 10-year average for May which is 81 days.
Regional Analysis - Canterbury
“The Canterbury market continues to remain steady with a median price increase of 3.4% to $460,000. Canterbury was only one of three regions to see an uplift in the monthly HPI showing good underlying value across the region, despite the impact of COVID-19. With new listings down 4.4% and sales volumes down 43.7% compared to this time last year, there is a real lack of listings available to meet demand. Additionally, there is a new batch of buyers and investors who have emerged post-lockdown who are attracted to the low interest rates and lifted LVRs. However, there is cautious optimism locally with minimal job losses, but people are worried about what may come in the coming months. Overall, the market is busy likely a result of the bottleneck from lockdown. If local job losses are kept to a minimum and we stay in the low alert levels, there should be continued momentum in the market.” (REINZ)
The current Days to Sell of 58 days is much more than the 10-year average for May which is 37 days.
Regional Analysis - Otago
“Queenstown Lakes median price remains fairly consistent with a slight dip in median prices of -2.6% year-on-year to $950,000. New listings increased 21.8% compared to the same time last year, one of only two regions to see an annual increase. There are significant numbers of active buyers in the market, many of them from surrounding areas in the South Island in addition to expats looking to invest with the view of returning to New Zealand in the future. However, the negative commentary around the Tourism Industry means that many of these buyers are reluctant to commit at present. Bank lending continues to remain an additional challenge for purchasers.” (REINZ)
“Median prices in Dunedin City remained a little below the pre-lockdown trend at $500,000 but with so few sales we will have a clearer picture of any market changes after the June and July statistics are released. Sales decreased 46.7% from 255 in May 2019 to 136 in May 2020 largely due to the lack of new listings coming to the market during and just after the lockdown. First home buyers are just as active as pre-lockdown with good activity at open homes.” (REINZ)
The current Days to Sell of 51 days is more than the 10-year average for May which is 42 days.
Regional Analysis - Southland
“The Southland region saw the largest increase in annual median prices, up 22.8% reaching $345,000. The REINZ House Price Index also saw a 17.1% annual increase showing the continued strength of the region. Days to sell increased by 18 days from 32 days in May 2019 to 50 days in May 2020, the lowest median days to sell across all regions. There is more investor interest with low interest rates and opportunities being sought out, however, there are fewer first home buyers compared to previous months likely due to COVID-19 and unemployment.” (REINZ)
The current Days to Sell of 50 days is more than the 10-year average for May which is 44 days.