House sales jump in November
November real estate figures provide conclusive evidence that the Reserve Bank’s interest rate medicine is reviving the housing market.
Tuesday, December 18th 2001, 8:32PM
by Jenny Ruth
The number of homes sold in November jumped to 7,881, the highest level of activity in that month since 1996, Real Estate Institute figures show. November sales were worth $1.69 billion, well up on 6,666 worth $1.44 billion sold in October and the 5,810 worth $1.23 billion sold in November last year.
The Reserve Bank has cut its official cash rate, which directly influences variable mortgage rates and indirectly affects longer-term rates, five times this year from 6.5% to 4.75% with the most recent cut on 14 November.
Institute president Rex Hadley says the low interest rate environment is a large factor in the rise in sales.
"The lower interest rates currently available have allowed a lot more first home buyers to enter the property market, it’s incredibly satisfying to see more New Zealanders be able to fulfil their dream of owning their own home," Hadley says.
"The institute has always said that home ownership is a large part of the New Zealand culture and I think November’s figures reflect that. I personally don’t believe that many people prefer to rent," he says. Floating mortgage rates now range between 6.24% and 6.90%
Reserve Bank Governor Don Brash should also be pleased that the increased activity hasn’t had an inflating effect on house prices.
The national median house price actually fell from $179,000 in October to $176,200 in November. That was still above the $174,000 median house price in November last year.
The institute’s figures show that of the 11 regions measured, activity improved in November in all compared with October and in all except Northland compared with November last year. There were 193 homes sold in Northland in November last year compared with 157 this year.
The median price figures were more ambiguous. Compared with October, prices rose in five of the 11 regions and fell in the other six. Compared with November last year, prices rose in eight regions, fell in two and were unchanged in Manawatu/Wanganui.
TOTAL DWELLINGS MEDIAN PRICE COMPARISONS FOR OCTOBER 2000-2001 REGION
OCT 00 SEPT 01 OCT 01 Northland
155,500
135,000
160,000
Auckland
233,000
249,000
258,000
Waikato/BOP/Gisborne
155,000
158,000
163,500
Hawkes Bay
135,500
132,500
130,000
Manawatu/Wanganui
112,000
107,000
105,000
Taranaki
100,000
105,000
100,000
Wellington
190,000
185,000
195,000
Nelson/Marlborough
149,500
150,000
147,000
Canterbury/Westland
142,500
142,000
141,000
Otago
95,500
92,500
110,500
Southland
90,000
83,000
89,000
NZ Total
$170,500
$173,000
$179,000
| « Fixed mortgage interest rates begin to firm | Roller coaster year for housing and mortgage markets » |
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