Home sales edge higher in December, prices slip

The total number of homes sold nationwide last month rose to 4,302 from 4,279 in November, according to the Real Estate Institute of New Zealand (REINZ). Sales fell from 5,597 in December 2007. The media house price fell to $328,500 from $337,500, the REINZ said.
     
A correction in some overheated regions, the effect of the election and the global economic downturn “has resulted in the slowest residential market we’ve seen in several years and in areas where prices had sky-rocketed these have come back,” said Mike Elford, REINZ president.
     
Time to sell rose to a median 45 days from 36 days in December 2007 and the biggest decline in prices was in either holiday destinations or districts where prices had surged in the past two-to-three years, the institute said. Prices fell 11% in Nelson/Marlborough and dropped by 13% in Southland.
     
Mortgage lenders including Westpac and ANZ National Bank have lowered their rates this month in anticipation of further cuts to the official cash rate starting on January 29. Reserve Bank Governor Alan Bollard may cut the benchmark rate by 100 basis points to 4% this month and keep lowering the OCR to just 2.5% by mid-year, according to economists at Westpac.

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