New Zealand real estate recovery is hamstrung by excess inventory. Falling prices across the market are chipping away at recent gains, as reluctant buyers and sellers are leaving sales slumping. See the following article from Property Wire for more on this.
Property values are still falling in New Zealand and are now more than 5% below the market peak of 2007 while a much anticipated spring surge in new real estate listings has failed to emerge, the latest property figures show.
Quotable Value’s September index, calculated from the previous three months’ market figures, is still 2% above the same time last year, but the gap is closing, the latest report shows.
Values increased 3.4% in the six months to March this year but have fallen 1.4% since then, as market sentiment remains cautious. The average New Zealand sales price in the past three months dropped from $407,900 to $401,968.
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Values in the Auckland area are still 4.3% above the same time last year while in Wellington they have dropped 2.8% since April and are now only 0.3% above the same time last year. Values in Dunedin have been variable in recent months, but have dropped since April and are now only 0.3% above the same time last year.
QV research director Jonno Ingerson said low numbers of sales continued to be a dominant feature of the market as buyers held back to see what the market does. Some were being cautious in their decision making, while others were unable to find suitable properties, he said.
‘Other financially secure vendors are holding out for their desired sale price rather than being tempted by low offers,’ Ingerson added.
Valuers, particularly those in Auckland Wellington, were reporting a lack of well presented, quality properties on the market. Those that did come up were selling quickly and for good prices, Ingerson said.
Property values in urban areas seemed to be stabilizing while provincial centers values continue to be flat and real estate values in rural areas keep sliding.
Separate figures shows that in September listings were up just 1% on a seasonally adjusted basis from August. The September total of 10,559 new listings is down by 17% as compared to Sep 2009 and down 12% as compared to the same month in 2008.
The continued pressure in the market remains the high level of inventory of unsold houses which increased again in September to 47.5 weeks. Inventory levels are now up 48% year on year and a long way adrift from the long term average of 39 weeks.
This article has been republished from Property Wire. You can also view this article at Property Wire, an international real estate news site.