House prices plummet by 12.9pct over last year – REINZ (WATCH)

The property market is continuing to slow with grim new figures showing the national median house price had plummeted by 12.9 percent over the last year.

The latest Real Estate Institute of New Zealand‘s (REINZ) March figures showed sales had decreased and properties are taking longer to sell.

REINZ chief executive Jen Baird said there is no denying New Zealand’s grim and gloomy economic situation is influencing the housing market.

“While we have seen activity pick up in March, this year’s summer season has been muted. Prices have eased as we can see, and properties are taking longer to sell,” Baird said.

“Buyers are taking their time, they are negotiating, and some are waiting to see if prices ease further.”

The figures, released on Tuesday morning, showed the national median price had plummeted by 12.9 percent annually to $775,000 in March.

Days to sell had risen to 45 days for March – up nine days compared to the same month last year and down 15 days from 60 when compared to February this year.

Two regions bucking the trend and seeing an increase in their annual median price were the West Coast and Southland – the only two places to see an increase.

The West Coast was the biggest improver up 5.8 percent to $365,000, followed by Southland up 2.3 percent to $450,000.

Properties on the market in March also increased by 3625 to 29,284 from the same time in 2022. This number was up 0.7 percent compared to February of this year.

This has resulted in inventory levels returning to the long-term average, which Baird said presents a good opportunity for buyers to “take advantage of the lower prices and less competition”.

“REINZ members tell us first home buyers are actively returning in the regions with the advantage of choice as investors remain absent,” Baird said.

Houses sold across New Zealand in March were up from 4113 in February to 5877 – an increase of 42.9 percent.

For everywhere except Auckland, sales decreased by 10 percent annually but increased 34.3 percent month-on-month.

But it isn’t all bad news for sellers and buyers, with Baird saying properties are selling but Kiwis just need to be patient.

“There are clear signs that we are in the lower phase of the cycle, but with nearly 6000 properties sold, vendors who are motivated to sell are meeting the market with more realistic expectations on time frame and price. Those who need to sell are still selling,” Baird said.

The number of properties coming onto the market took a drop in the latest figures by 17.7 percent from 11,224 listings in March 2022 to 9242 listings in the same month this year.

The City of Sails saw new listings drop annually by 22.1 percent from 4033 to 3143 and the only regions to see new listings increase were Taranaki, rising 9.7 percent and Marlborough, rising 18.6 percent.

Baird said the major weather events, like Cyclone Gabrielle and the Auckland flooding in January, are still being felt in those regions heavily impacted.

“The market is likely to remain in this phase as New Zealanders wait for the peak of inflation, a settling in interest rates and some clarity around the possible outcome of the election,” Baird said.

“That said, with the number of listings continuing to ease, we may start to see the supply/demand balance change in some areas.”

The REINZ House Price Index (HPI) for New Zealand, which measures the changing value of residential property nationwide, showed an annual decrease of 13.1 percent for New Zealand and an 11.5 percent decrease for Aotearoa excluding Auckland.

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