Off to a pleasing start, the year of the rooster has already begun with plenty of momentum across the domestic property sector, says Bayleys’ national residential manager Daniel Coulson.
While the recently released sales statistics from the Real Estate Institute of New Zealand (REINZ) have shown sales volumes across the country as reaching a plateau, record sale prices are still being achieved from the big cities to regional towns.
The volume of sales across New Zealand in December 2016 fell by 11 percent year-on-year, with only 6,533 sales achieved for the month. Yet the figure is not so alarming when put into perspective, and on a ‘seasonally adjusted basis’ sales for December 2016 fell less than one percent (in line with expectations for the often quiet Christmas holiday period).
Along with flat or falling sales volumes, property across the country continues to reach new heights with each of the 12 regions recording year-on-year median price increases.
While the national median sale price rose 11 percent compared with the same period last year to $516,000 (a mere $4,000 short of the record median achieved in November 2016), Wellington led the charge as five regions including Northland, Hawke’s Bay, Otago and Southland achieved record new median sale prices.
This is of significant reassurance to both buyers and sellers, illustrating that lending restrictions implemented by the major banks have had their desired effect, curbing investor market-share while showing that buyer interest remains high – and that serious buyers are willing and able to compete for their dream-home.
Continuing the trends observed in the latter half of 2016, ‘million-dollar home’ sales persist showing the largest increase in sale volumes. Further demonstrating the effect of investor withdrawal from the market, the number of dwellings sold for under $600,000 has declined by 884 year-on, while homes sold for more than one million dollars rose by 12 percent, accounting for almost 13 percent of the total number of homes sold for the month.
With many factors working together to influence the residential property sector (low interest rates, population growth, consistent demand), the trends observed in December 2016 look set to continue for the months of January and February as we head toward the busiest period on the property calendar in March.