Housing market robust in January

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The latest real estate sales figures show the strong recovery in evidence late last year has continued into 2002.

Tuesday, February 19th 2002, 9:20PM

by Jenny Ruth

The number of homes sold in January was a robust 6,771, even though the month is traditionally slow because of the holiday season. In only two months of 2001, November and August were sales higher.

It compares with 6,147 sold in December and just 4,741 last January.

It’s the highest number of homes sold in January since 1997 when 7,849 changed hands.

Real Estate Institute president Rex Hadley says such a strong month "is very encouraging and bodes well for the rest of the year."

And although activity is bubbling, there are few signs this is leading to house price inflation. The median house price dipped from $178,000 in December to $175,000 in January, the same level it was at in January last year.

"What these figures are telling us is that market liquidity has improved, people are finding it much easier to transact residential property and are perhaps not as fixed in their pricing attitudes as they are in tighter economic times," Hadley says. When the economy is depressed, median prices can hold up but volumes tend to fall significantly.

He says continued low interest rates and a competitive mortgage market are supporting activity. The absence of sharp price increases "indicates that people are taking a more mature approach to residential property and that the heated environment in areas like Auckland in the mid-1990s is not likely to be repeated," he says.

"We suspect that the low interest rates are encouraging people to reduce their mortgages, which is what they should be doing."

January’s transactions were worth $1.41 billion, up on the $1.33 billion worth of residential property sold in December.

The institute’s figures show that activity in all of the 11 regions measured improved in January from a year earlier. Compared with December, activity was up in all but three of the regions, Northland, Manawatu/Wanganui and Nelson/Marlborough.

But the latter was one of only three regions in which the median house price rose from December, the other two being Otago and Southland.

The Nelson/Marlborough median price was also up on a year earlier, as were Northland, Auckland and Waikato/Bay of Plenty/Gisborne median prices. In the other seven regions the median house price was lower than in January last year.

REGION	JAN 00	JAN 01	DEC 01	JAN 02
Northland	171,250	149,000	162,500	160,000
Auckland	230,000	240,000	253,800	245,000
Waikato/BOP/Gisborne	159,500	160,500	169,000	165,000
Hawkes Bay	125,000	136,000	140,000	135,000
Manawatu/Wanganui	99,250	105,000	110,000	98,250
Taranaki	93,000	106,500	107,000	100,000
Wellington	185,000	195,000	195,000	191,000
Nelson/Marlborough	140,000	152,000	147,500	158,000
Canterbury/Westland	147,000	142,000	147,000	140,000
Otago	95,000	109,000	95,000	98,000
Southland	72,000	106,000	78,500	80,000
NZ Total	$169,250	$175,000	$178,000	$175,000

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