House prices in free fall

House prices tumbled a record $24,550, or 3% in just four weeks last month, the latest Trade Me House Price Index shows.

Tuesday, July 19th 2022, 3:28PM

by Sally Lindsay

The average asking price for a property is now $925,150 - the lowest since October last year, and marks the second record-breaking price drop in a row following May’s 2% month-on-month dip.

After creeping closer to the $1 million mark over the past 12 months, the national average asking price is in retreat, sitting significantly lower than the all-time high of around the regions, the biggest average asking price drops were in the main centres. In the Auckland region, the average asking price fell 4% cent month-on-month, while the Wellington region was not far behind with a 3% drop.

Trade Me property sales director Gavin Lloyd says the only regions to buck the trend were Otago and Taranaki, which had average asking price rises of 2% and 1% respectively when compared with May.

When compared with June last year, last month’s average asking price marked a 12% increase. “While this is still a significant, it’s the smallest annual percentage jump since November 2020,” says Lloyd.

He expects prices drop even further if supply remains high and demand is comparatively low.

Supply soaring

A major factor behind these price drops is listings continuing to soar.

Nationwide, supply was down slightly by 3% month-on-month but skyrocketed by 52% year-on-year, the largest percentage jump ever seen.

Listings have surged for three months in a row, and Lloyd says buyers are no longer feeling the pressure and can afford to take their time, and look at their options.

Every region across the country had more properties for sale last month when compared with June last year. The biggest increase in listings were in Wellington, up 93), Hawke’s Bay, up 90%, Bay of Plenty and Nelson/Tasman, both up 85%.

However, demand fell nationwide by 7% year-on-year last month Lloyd says this meant the market cooled off further and accelerated price drops.

Wellington prices drop 3%

The Wellington region had an average asking price of $936,300 last month. While this marked a drop on May, it’s an 8% increase when compared with the same month last year.”

Wellington city’s, average asking price fell by 1% month-on-month to $1,055,350. This puts it just behind the most expensive district in the region, South Wairarapa at $1,082,400, while Porirua was the third most expensive spot at $971,250.

While supply surged in Wellington, demand in the region grew by just 1% year-on-year.

The country’s most popular property last month was a two-bedroom, one-bathroom house on Wallace Street in Mt Cook. “The house was watch listed 440 times in its first seven days on Trade Me.

Auckland prices soft

In the Auckland region, last month’s average asking price rose 9% when compared to the same time last year, but it is the first month it has dropped to single figures since March 2021.”

The most expensive district in the Auckland region was Waiheke Island, sitting at $1,662,900. North Shore came in second, with an average asking price of $1,416,550 and was followed by Rodney at $1,324,900.

Listings in the Auckland region were up 40% year-on-year in June, while demand was down 14%.

The most popular property in the city was a four-bedroom, five-bathroom house on Hobson Street in the city centre. It was watch listed 418 times in its first seven days on Trade Me.

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