Property market listings stay at the bottom of the barrel

For Auckland, Waikato, Bay of Plenty, Gisborne, Hawke's Bay, Wellington, Southland, Coromandel, Central Otago/Lakes District, Wairarapa, Central North Island, and Manawatu/Whanganui, new listings were at record lows for any June since 2007. 

Year-on-year, listings were down by more than 20% nationally and in 12 of the 19 regions monitored.

The property website had 6,218 new residential listings last month, down 21.2% compared to June last year and down 17.6% compared to pre-Covid levels in June 2019.

A total of 24,676 residential properties were available for sale at the end last month, which was down just 6.1% compared with June last year.

However, the number of people searching for properties on Realestate.co.nz last month was up 8.6% compared to a year ago.

Kiwis remain hesitant to list their properties – mainly because of economic factors, says Vanessa Williams, realestate.co.nz. spokeswoman.

"We know people are feeling the effect of inflation and rising interest rates in their pockets.”  The pent-up supply in the wings could hit the market later in the year, she says.

Northland was the only region where new listing numbers increased year-on-year, up 19.0% compared to June last year.  About 300 properties came onto the market in the region last month.

Mortgage activity rises

Asking prices continued to weaken, with the national average asking price declining for the fourth consecutive month to $841,688 in June, which means it has declined by $80,744 (-8.8%) since June last year.

However, NZ Mortgages managing director Nathan Miglani says despite the falling prices his business has noticed an increase in buying activity.  

"We may be in a 'technical recession', but we’re seeing a warming of the real estate market. News of a decline in inflation is giving buyers confidence, and momentum is building with increasing activity.

"Earlier this week, four clients competed at auctions. One missed out, but three were successful – and every one of those auctions had multiple bidders."

Increasing prices

One area of the country is continuing to buck the falling average asking price trend. Central Otago/Lakes District hit an all-time record high of $1,484,600 in June. Prices have been rising since the beginning of 2022, in direct contrast to the national average asking price, which has fallen by $129,812.

Williams says the tourism mecca seems to be less impacted by the economic factors affecting other regions in New Zealand.

"The Central Otago/Lakes District is almost in its own economic micro-climate. Demand is still high for property in this region, and it would seem that buyers are not as impacted by rising interest rates and rising household inflation," she says.

"Plus, many people buying in this region are from overseas, where they potentially have higher incomes and favourable exchange rates." 

Most people searching for property in the region are located further afield. The biggest number of people searching in Central Otago/Lakes District last month were in Auckland, followed by Canterbury and New South Wales. Other Australian states, Queensland, Victoria and Western Australia were also among the top 10 locations for searchers.

Only two buyers' markets remain

Just two regions, Auckland and Taranaki, were in buyers' markets during June – a change from the seven regions favouring buyers at the close of last year.

Williams says that while Auckland has been in a buyers' market for several months, it appears to be weakening.

"If no new properties were to come onto the market, the number of weeks it would take to sell the existing Auckland supply is moving closer to the long-term average. This tells us that property is moving slightly faster in Auckland than it was at the beginning of the year."

Building consents drop

The number of new dwellings consented in May was 45,159, down 11% over the previous 12 months.

Stats NZ figures show the seasonally adjusted number of new dwellings consented fell 2.2% in May \ after falling 2.6 percent in April.

In May, there were 3,725 new dwellings consented, comprising:

• 1,732 townhouses, flats, and units
• 1,643 stand-alone houses
• 225 apartments
• 125 retirement village units.

The number of new stand-alone houses consented rose 1.6 percent, after falling 1.9 percent in April.

Regional new dwellings

By region, the numbers of new dwellings consented in the year ended May , compared with the previous year were:

• 19,539 in Auckland (down 9.9 percent)
• 4,244 in Waikato (down 18 percent)
• 3,421 in Wellington (down 12 percent)
• 6,112 in rest of North Island (down 17 percent)
• 7,917 in Canterbury (down 7.2 percent)
• 3,925 in rest of South Island (down 11 percent).