REINZ chief executive Colleen Milne
by Miriam Bell
REINZ chief executive Colleen Milne
The latest Real Estate Institute of New Zealand (REINZ) data is out today and it shows that the SuperCity has seen in the new year with dramatic falls in both median prices and sales volumes.
Auckland’s median price fell by $50,000, or 6.5%, to $720,000 in January 2016. This is in comparison to $770,000 at the end of 2015.
It was still up by 9.1% on January 2015’s median price of $660,000.
Once seasonally adjusted, Auckland’s median price was down by 1.3% on December, but up 9.4% on January 2015.
The decline in the region’s total sales volumes was even more pronounced.
Auckland sales were down by 31.4% compared to December and by 13.5% compared to January 2015.
Once seasonally adjusted, they were down 4.5% compared to December and 10.5% compared to January 2015.
On top of this, Auckland’s share of national auction sales was dropped off significantly over the last year.
In January 2015, 78% of all auction sales were in Auckland. That share had fallen to 52% by January 2016.
REINZ chief executive Colleen Milne said that, while January is an unusual month for real estate data, Auckland continues to show declining sales numbers.
However, the reasons are many and varied and include the city’s very tight listings position, she said.
“The Auckland region continues to experience very low levels of listings, despite the recent decline in sales volume.
“Potential vendors are struggling to find new properties to buy and are unable to sell their existing property, helping to create a vicious circle of willing sellers if only there was something to buy.”
Part of the fall in sales could be due to this reason compounding existing issues around the new LVR rules, Milne said.
The REINZ data also showed that while the trend in Auckland’s median price continues to rise, the trends in sales and days to sell were both now easing.
This means the overall trend for the region continues to be flat.
Meanwhile, in January nationwide sales volumes fell by 31.0% on December – although they were up 4.3% on January 2015.
Once seasonally adjusted, sales fell by 5.1% on December, which indicates sales were slightly softer than would normally be expected at this time of year.
However, once Auckland was taken out of the equation, sales volumes were up 14.5% on January 2015 and up 21.7% on a seasonally adjusted basis.
The national median price fell by 3.7% as compared to December.
This left it at $448,000, which was up $22,000, or by 5.2%, from January 2015.
Milne said activity in the regions continues to show the influence of the halo effect.
While all regions recorded a decline in sales volumes compared to December, 10 regions recorded increases in sales volumes, as compared to January 2015.
Hawke’s Bay recorded the largest increase of 36%, followed by Northland with 31% and Waikato/Bay of Plenty with 27%.
New record national median prices were hit in Hawke’s Bay and Taranaki, with Canterbury/Westland equalling its record median set in April 2015.
Westpac chief economist Dominick Stephens said the REINZ January data was very weak, with sales and prices falling on a nationwide basis.
The weakness was most evident in Auckland, but sales and prices also fell across most of the remainder of the North Island which was something new, he said.
“This data is a continuation of the weak trend for the Auckland market. Stronger data in December had raised the possibility that the market was stabilising, but that no longer looks to be the case.”
However, January data can be volatile so it was best not to read too much into it at present, Stephens said.
Rather it was necessary to wait for more data in the coming months.
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