Property Market Update For June 2023
The Real Estate Institute of New Zealand (REINZ) has released its June 2023 report, which shows a renewed level of activity in the New Zealand property market.
Compared to June 2022, June 2023 has seen a notable increase in sales, with a total of 5,629 properties sold across New Zealand, up 14.6% year-on-year.
This increase in sales is particularly noticeable in the number of prospective buyers attending open homes, along with an increase in first-home buyer activity due to the easing of LVR restrictions that came into effect on 1 June.
This increase in buyer activity is providing an increase in auction activity and an improved success rate with auction campaigns.
In our own office (Ray White Parnell) the average “Days on the Market” (DOM) for auction, campaigns are currently 34 days, while by negotiation the DOM is stretched out to 92 days.
The auction success rate, again for our office during June, was back above 80% which shows a strengthening response from the market and an indication of growing buyer interest within our region.
Historical data tells us that we typically expect a decrease in sales when moving from May to June across New Zealand. However, when that seasonal trend is considered, by applying seasonal adjustment to the sales count figures, we see that June 2023 exceeded expectations when compared to the sales count in May 2023.
The REINZ House Price Index (HPI) for New Zealand, which measures the changing value of residential property nationwide, showed an annual decrease of -9.0% for New Zealand and a -8.0% decrease for New Zealand excluding Auckland.
Nationally, new listings decreased by 21.2% year-on-year, from 7,893 listings to 6,218, and a 15.5% decrease compared to May 2023.
This decrease in new listings is contributing to the increase in buyer activity, with more buyers chasing fewer listings.
Overall, the increase in sales and buyer activity in June 2023 is a positive sign for the New Zealand property market, particularly with the easing of LVR restrictions and the increase in first-home buyer activity.
However, the decrease in new listings may well lead to a shortage of available properties, which could drive up prices in the future.
In summary, the key takeaways from the REINZ June 2023 report are:
- A notable increase in sales compared to June 2022, with a total of 5,629 properties sold across New Zealand, up 14.6% year-on-year.
- An increase in first-home buyer activity due to the easing of LVR restrictions that came into effect on 1 June.
- An increase in buyer activity, providing an increase in auction activity and an improving success rate with auction campaigns.
- A decrease in new listings, which may lead to a shortage of available properties in the future.
- The REINZ House Price Index (HPI) for New Zealand showed an annual decrease of -9.0% for New Zealand and a -8.0% decrease for New Zealand excluding Auckland.
What this shows us is that there seems to be a little less uncertainty in the property market this past month.
Of course, we have an election coming up and the market traditionally slows in the month or so preceding an election, so watch this spot!
Lisa and Steve Stone
Elite Agents for Ray White