New Zealand’s residential property market is moving firmly in favor of sellers as a drop in the number of properties for sale accelerates, according to the latest report from NZ Property.
The truncated mean asking price for all new listings in June rose very slightly from $414,308 in May to $415,053. On a seasonally adjusted basis the asking price rose just 0.8% in the month indicating a degree of caution amongst sellers, the report says.
The overall trend of the past two years continues to show a slow but steady strength in asking price expectation. Meanwhile, the level of new listings coming onto the market in June fell again to 9,111. This represented an 18% year on year decline but a 2% seasonally adjusted rise from May.
On a 12 month moving basis the number of new listings in the past year totals 125,848 as compared 145,920 for the same period a year ago, a fall of 14%, the report also shows.
The level of unsold houses on the market at the end of June continued to fall from prior months. June reported 47,738 down from 48,352 in May and 50,398 in April.
The recent relative strength of sales as seen in March through to May has now stared to see a clearing of what has been a high level of unsold houses on the market over the past 18 months. Heading into winter, a time of traditionally weaker listing will likely see this inventory level fall further in coming months, it adds.
Overall, asking prices, having fallen in May, barely changed in June. Across the regions, there are some variances. A total of just six regions saw an increase in asking price expectations as compared to 13 showing falls.
The scale of some of these movements was significant, even outside of the smaller regions, which tend to exhibit large variances. Most noticeable were falls of greater than 5% in Wellington, the Hawkes Bay, Taranaki and Otago.
The largest asking price rises of greater than 5% were seen in the Bay of Plenty and Coromandel region, the latter still witnessing high inventory and as such is very much stuck in a buyers market. The biggest movement in asking price this month was seen in Southland with a 6.8% increase as compared to the recent three-month average.
The regional perspective of new listing is very clear this month with one solitary region showing a rise in new listings comparing June 2011 with a year earlier. The Central North Island as well as seeing a rise in new listings is experiencing a buyers market with inventory of unsold properties exceeding long term average.
The majority of regions, 13 out of 19, saw double digit falls of new listings on a year on year basis with the biggest falls seen in the West Coast, Gisborne, Bay of Plenty, Marlborough, Canterbury and Wiararapa.
Two regions in June reported the lowest levels of listings going back to Jan 2007, they were Northland with 352 listings and Wiararapa with 117 listings.
The levels of inventory of unsold homes on the market fell further in June. In the space of just three months, the levels have fallen from significant highs to be very close to long term average for many regions of the country.
‘For two years, the predominant look of the regional inventory map has signaled a buyers market. In June there were seven regions on or below their long term average for inventory of properties on the market,’ the report says.
The most significant regions experiencing this shift to a seller’s market are Auckland and Queenstown and they are now joined by the Bay of Plenty, the Waikato and Otago. Not far behind the regions of Nelson, Wellington, Canterbury and the West Coast, all of which are edging to a turning point in the market with more balance between buyers and sellers.
That still leaves nine regions, all of which are provincial, firmly in a buyers market with existing inventory well above long term average.