Falling rates stimulate market

• Tweet

The Real Estate Institute says the April housing sales figures show falling mortgage interest rates are helping to stimulate the housing market.

Monday, May 21st 2001, 3:28PM

by Jenny Ruth

While the number of house sales dipped compared with March, they were up compared with April last year and the median price was higher than in either March or April last year.

"March is traditionally one of the most active months for real estate transactions and 2001 is no different. It was always unlikely that April would achieve a similar number of sales," says institute president Rex Hadley.

Sales nationally totalled 6,506 in April compared with 6,559 in March and just 5,238 in April 2000.

"Such a high level of improvement over last year’s sales volume bodes well for the residential housing market in 2001, and demonstrate the stimulating influence easing mortgage interest rates have had on the residential market," Hadley says.

Total sales rose from $1,394,271,191 in March to $1,423,745,699 in April. That compares with $1,106,697,099 in April 2000. The median sale price of $178,000 was $4,200 higher than in March and compares with $177,000 in April last year.

A year ago, many New Zealanders had lacked confidence in the country’s economic direction and had effectively sat on their hands, Hadley says.

"More recently, factors such as falling interest rates and improved employment figures have encouraged homebuyers, not only to re-enter the market, but also to increase their level of financial commitment to residential property."

The Reserve Bank has cut its official cash rate, from which other interest rates are set, three times this year from 6.5% to 5.75%. The unemployment rate has fallen to a 13-year low of 5.4%.

 

REINZ PROPERTY MARKET REPORT

TOTAL DWELLINGS MEDIAN PRICE COMPARISONS FOR APRIL 1996-2001

REGION	APR96	APR97	APR98	APR99	APR00	MAR01	APR01
Northland	113,000	130,000	141,000	152,250	157,000	146,500	150,000
Auckland	229,000	236,000	235,000	235,000	242,000	248,500	248,500
Waikato/BOP/Gisborne	130,000	141,750	145,500	153,000	157,000	160,000	165,000
Hawkes Bay	122,500	127,500	109,750	131,000	125,000	130,000	128,000
Manawatu/Wanganui	103,000	102,500	101,000	10,000	100,750	106,000	109,000
Taranaki	105,000	95,000	100,000	101,000	108,000	105,000	106,500
Wellington	142,000	150,000	156,150	175,000	190,000	190,000	195,000
Nelson/Marlborough	134,000	140,500	146,000	142,510	146,250	150,000	147,500
Canterbury/Westland	129,000	140,250	141,750	148,000	140,000	149,000	135,000
Otago	104,500	102,500	89,500	94,750	100,000	95,250	99,250
Southland	78,000	85,000	75,000	90,500	103,500	85,000	96,000
NZ Total	$149,000	$162,500	$160,000	$170,000	$177,000	$173,800	$178,000

« The time is near for capped rate loans

Don't hold your breath for loans from the Red Sheds »

Commenting is closed

 

Printable version

Email to a friend