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Bayleys Research


NOVEMBER 07 BULLETIN

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RESIDENTIAL UPDATE

In recent months, the indicators suggest that the Reserve Bank is achieving its objective of steering New Zealand’s housing market towards a slowdown. The September figures released by the Real Estate Institute of New Zealand (REINZ) clearly illustrate a fall in market activity, despite the national median sales price for September edging up slightly by 0.4% since August 2007 to a record high of $351,500. In the twelve months to September 2007, the national median dwelling price is up by 12.3%. However, in the six months to September 2007, the increase has only been 2.3% indicating that the majority of the value growth over the past year occurred between September 2006 and March 2007, with a subsequent slowdown following the Reserve Bank’s introduction of the first of four OCR increases in March 2007.

 

 

Sales volumes have generally trended downward over the last year with 5,894 sales recorded in September, a fall of 32% compared with the corresponding month last year. As the graphical representation indicates, the slide in sales volumes has been relatively gradual in the latter six months of this period, with the exception of a spike in May, leaving the current sales volume at a five-year low.

In September, movement in median values amongst the regions, as identified by REINZ was varied. Seven of the twelve regions experienced an increase in values, whilst the remaining five were down on the August 2007 values.

Over the past two years, the Southland region achieved the highest value growth in year-on-year prices for September 2007 with values increasing by 54.2%. Manawatu/Wanganui followed with 37.1% growth and Wellington was in third with 28.2% growth. In contrast, Otago achieved just 7.3% growth over the same period.

 

 

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