The CoreLogic NZ December Housing Chart Pack shows that national property values rose by 0.7% in November, marking the second monthly increase as the residential market cycles into its ‘next phase’.
CoreLogic NZ Chief Property Economist Kelvin Davidson said there are signs of the country’s upturn slowly broadening looking at growth patterns across the past three months.
Average property values recorded a 1.1% rise nationally over the three months to November, and also saw the smallest annual drop (-4.5%) since the same time last year.
The main centres were fairly strong over September to November, with only Tauranga recording a decline (-0.6%) in median property values.
Dunedin lead with a nearly 3% lift in values and Christchurch closely followed at 2.0%. Both Auckland and Wellington saw property values increase by 1.2%.
However, at a regional level, areas such as Whangarei, New Plymouth, Kapiti Coast, and Nelson have continued to drift lower in recent months.
Mr Davidson said property sales volumes have continued to trend upwards for seven months in a row, however considers the growth rate is still on the ‘slow side’.
“Property sales across November were up by around 19% from the year prior. However, it’s from such a low base for activity, that this growth rate isn’t yet translating into a significantly higher number of sales.”
While property market listings have now begun to wind down for the holiday period, total stock levels have remained lower than previous years, even during the normal Spring influx.
“New listing flows into the market are nearly 12% down from this time last year, which has overall limited buyers’ choice of fresh stock,” he said.
Mr Davidson said the market’s recovery has certainly arrived, but is in its early days.
“With strong migration and the broad plateau for mortgage rates not set to drop materially for perhaps another year or so, it wouldn’t be a surprise to see a patchy year for both sales and prices in 2024.”
“Even as interest deductibility gets phased back, it’ll still be sticky for investors to sum up favourable returns when yields are low and mortgage rates high.”
“First home buyers will still have good opportunities, since we don’t anticipate investor activity to return to peak levels. All borrower groups, however, will be keeping a close eye on the prospect of caps on debt to income ratios next year.”
December Housing Chart Pack highlights:
• Residential real estate is worth $1.59 trillion.
• National property values saw a 0.7% rise in November, the second increase in this ‘new phase’ following October’s 0.4% lift. The main centres are generally rising, but tr
