New REINZ data reveals the highest year-on-year increase in almost two years
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The number of properties sold this month increased by 6.6% compared to April of last year, the highest year-on-year increase the industry has seen in 23 months, according to the latest data from REINZ.
6,368 houses were sold this April compared to 5,973 in April 2017 with the regions accounting for a significant chunk of the growth. Sales in West Coast went up by 50%, and Southland, Marlborough, Nelson and Manawatu/Wanganui also saw solid increases. Auckland’s growth was recorded at a more moderate 2.4%, going from 1,810 to 1,854 since April of last year.
The median house price for New Zealand rose by 1.9%, with median prices excluding Auckland increasing by 5.7%. Auckland and Canterbury saw decreases of 0.6% and 0.9% respectively, though this is attributed to the rise in properties sold within the affordable price bracket. REINZ’s House Price Index (HPI) measures the changing value of the property market, and recorded a 3.8% increase year-on-year.
According to REINZ Chief Executive Bindi Norwell, the overall data paints a positive picture of New Zealand’s housing market and overall economic strength.
“We’ve had more properties sold than this time last year, which is a great indicator of activity,” Norwell told NZ Adviser. “Year-on-year volume growth has been down for some time now, but we’ve had some very positive growth this month- the highest it’s been in almost two years.”
“Auckland prices did go down 0.6% year-on-year, but if you look into it more closely, the median gets quite skewed,” Norwell explains. “More properties were sold in the $250k-$750k range, which is actually a good thing as it means more apartments and new builds are being sold in the affordable bracket. It becomes more about the mix of properties, rather than the actual price going down. The HPI is a much better indicator as it takes out all the factors that might skew the data, and that indicates that prices went up 0.9%. Auckland has been stable for some time, and it’s holding its price.”
Norwell says she expects the regions to continue their growth, and that next week’s budget announcement will make a large difference in terms of infrastructure spending. KiwiBuild is also expected to increase sales in the affordable price bracket, and Norwell says it will make a significant difference to housing affordability across New Zealand.
“KiwiBuild is a fantastic initiative to build new houses, and it now all rests on whether it can be delivered,” she says. “We need more labourers to build these homes, and we need some smart ways to remove the red tape and secure the right amount of funding. It’s a great initiative and they’ve set an ambitious target, but now they need to keep up with it.”
