NZ housing market pace slow, regions rising

Ōtautahi - The slowing economic climate with median prices and sale counts easing and properties taking longer to sell are reflected in the latest Real Estate Institute of New Zealand’s (REINZ) March 2023 figures.

REINZ chief executive Jen Baird says there is no denying the current economy is influencing market activity.

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

Nationally, the median price decreased 12.9 percent annually to $775,000 in March 2023. Days to sell have risen to 45 days for March 2023, up 9 days compared to March 2022 and down 15 days from 60 when compared to February 2023.

At the end of March, the total number of properties for sale across New Zealand was 29,284, up 14.1 percent year-on-year and up 0.7 percent month-on-month.

Aotearoa, excluding Auckland was up from 14,923 to 18,742, an increase of 3,819 properties annually (+25.6 percent).

Baird says inventory levels are returning to the long-term average, which presents an opportunity for buyers looking 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.

The total number of properties sold across New Zealand in March 2023 was 5877, up from 4113 in February 2023 (+42.9 percent), and down 15.0 percent year-on-year. New Zealand excluding Auckland sales counts decreased by 10.0 percent year-on-year but increased 34.3 percent month-on-month.

There are clear signs that we are in the lower phase of the cycle, but with nearly 6,000 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.

Nationally, new listings decreased by 17.7 percent, from 11,224 listings in March 2022 to 9,242 listings in March 2023. Compared to February 2023, listings increased by 13.5 percent from 8,143 to 9,242.

New Zealand excluding Auckland listings decreased 15.2 percent year-on-year from 7,191 to 6,099. Auckland’s listings were down 22.1 percent from 4,033 to 3,143 year-on-year with the only regions increasing being Taranaki (+9.7 percent) and Marlborough (+18.6 percent).

The weather events of the beginning of year are still being felt in those regions heavily impacted. The market is likely to remain in this phase as New Zealanders wait for peak of inflation, a settling in interest rates and some clarity around the possible outcome of the election. That said, with the number of listings continuing to ease, we may start to see the supply/demand balance change in some areas.