Newly released data from the Real Estate Institute of New Zealand (REINZ) shows the real estate market is a mixed picture, especially in Auckland.
REINZ CEO Bindi Norwell
says there is something in the Auckland market now for buyers and sellers, pointing out even though there are more houses available and median prices rose a seasonally adjusted 11% year-on-year to $800,000, sales volumes were down in February 8.9% compared to February 2016.
The national median house price rose a seasonally adjusted 14.1% year-on-year to $495,000, up by $5,000 from January.
Two of 12 regions in New Zealand hit new record high median sale prices in February 2017 (Northland and Otago).
The median price across the Northland region rose by $71,250 (+20%) to $421,250 compared to February 2016 and across Otago by $47,250 (+18%) to $317,250.
REINZ regional commentator, Liz Nidd said, "The Otago market remains robust with another record median price recorded this month. The demand from investors has reduced, but the slack has very quickly been taken up by local home buyers. First home buyer activity remains steady."
Speaking to NZ Adviser
Norwell said more properties need to come on to the market in those two regions but in Auckland, inventory rose by 20% (1,562) over the past year, sharply increasing over the past three months.
“It’s a continuing trend the last couple of months so there’s more supply coming on, in the short term anyway.
“The LVRs we’re hearing are making a bit of an impact and also the banks are being a lot more selective with who they lend money to. So even if the properties become available to buy, you just need the money to be able to do it and so if the banks tighten up their lending criteria that will impact on the market going forward.”
On whether debt-to-income ratios will come into play, Bindi said this is unlikely to happen in an election year.
“I think there’s a lot more analysis that needs to be done because that’s a big change – so it needs to be the right change and know that it’s going to have a result.
“Even though they’ve talked about it I think there’s a lot more work before that could be a recommended option – particularly in election year.”