Analysts at the Real Estate Institute of New Zealand are blaming a supply shortage on the continuous increase in home prices, although that has stopped sales from increasing as well. January sales increased 34% over the prior month and sales were up 7.5% in February when compared to the same month in 2012. Every region in the country reported an increase in month-over-month sales volume in February, although experts say the real demand for homes and source of increased percentages is in Auckland and Christchurch. For more on this continue reading the following article from Property Wire.
The residential property market in New Zealand has experienced a last summer surge with house sales and prices increasing.
The data from the Real Estate Institute of New Zealand reveals that sales increased 34% last month compared with January and that sales are up 7.5% compared with February last year.
The National median house price was up 7.6% compared to February 2012 to $382,000 with Auckland seeing prices surge by 14.3%. It means that the national median house price is just $7,000 below the record set in December 2012.
Helen O’Sullivan, chief executive of the Real Estate Institute of New Zealand (REINZ), said that while the residential real estate remains active, the rate of growth in the number of transactions is slowing despite prices being near record levels.
‘Supply shortages in Auckland and Christchurch are the main constraint, resulting in double digit price increases in those regions with the median days to sell from listing at around 33 days. Across the rest of the country activity is more modest which is reflected in smaller increases in regional median prices,’ she explained.
‘The continuing reduction in the number of days to sell between this year and last year is also indicative of more buyer pressure in markets across the country,’ she added.
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All but two regions recorded increases in sales volume compared to February last year, with Northland recording an increase of 28.7%, followed by Auckland with 15.6% and Wellington with 11.7%. All regions recorded an increase in sales volume in February compared to January, with Central Otago Lakes recording an increase of 55.4%, followed by Southland with 51.2% and Wellington with 41.6%.
However the number of transactions remains well below historic levels, with the number of transactions in February 2013 just 71% of the total recorded in Feb 2007 of 9,357.
The national median house price rose by $12,000, from $370,000 in January, to $382,000 in February, an increase of 3.2%, and is just $7,000 below the record median price of $389,000 set in December 2012.
Canterbury/Westland recorded a new record high median of $355,000 in February with a 3.2% increase compared to January. All but two regions recorded an increase in median price in February compared to January, with Northland recording a 17.8% increase.
The national median house price is up 7.6% compared to February 2012, with the Auckland median price up 14.3%, followed by Central Otago Lakes with 13.9% and Canterbury/Westland with 7.4%.
The REINZ Stratified Housing Price Index, which adjusts for some of the variations in mix that can impact on the median price, is 8.1% higher than February 2012 and increased 1.6% compared to January. The Christchurch Stratified Housing Price Index is up 12.3% compared to February 2012, while the Auckland Stratified Housing price Index is up 11.6%.
Houses took two days fewer to sell in February 2013, following the usual seasonal pattern, compared to January 2013, improving from 41 days in January to 39 days in February. Compared to February 2012, the number of days to sell improved by seven days. All regions, with the exception of Northland, Nelson/Marlborough and Southland, saw an improvement in the number of days to sell between February 2012 and February 2013.
For the month of February, Canterbury/Westland recorded the shortest days to sell at 30 days, followed by Otago with 32 days, and Auckland with 33 days. Northland recorded the longest number of days to sell at 86 days, followed by Waikato/Bay of Plenty with 63 days and Hawkes Bay with 57 days. Over the past 10 years the median days to sell for the month of February has averaged 43 days across New Zealand.
Nationally there were 1,238 dwellings sold by auction in February representing 18.7% of all sales, an increase of 80.5% on the number of dwellings sold by auction in February 2012. Again this change is in line with seasonal trends, as the shorter trading month in January means that fewer auction campaigns, usually about three weeks long, are commenced and completed in that month.
Auctions are increasingly favoured as a sales method in certain areas. For the 12 months to February the total number of sales by auction reached 12,720 or 16.9% of all sales, compared to 7,488 or 11.7% of all sales for the 12 months to February 2012.
Transactions in Auckland again dominated the auction market in January, representing 71.9% of the national total of auction sales. Some 37.1% of all dwelling sales in Auckland were by auction in February; this was up strongly from the 21.1% of sales by auction in February 2012.
The data also shows that sales by auction in Waikato/Bay Of Plenty accounted for 9% of the national total, Canterbury/Westland accounted for 9.5% of the national total, and all other regions combined accounted for the remaining 9.6% of auction sales in February 2013.
This article was republished with permission from Property Wire.