Economic news might have been less than we’d have wanted for Christmas, but the property market is showing signs of resistance.
And that’s good news for buyers and sellers alike.
Prices are on the rise for the first time in seven months, according to the monthly Valocity housing report.
While the 0.7% rise is not spectacular, it indicates New Zealand’s property market has turned the corner after a series of aggressive interest rate cuts that have reduced the Official Cash Rate (OCR) to 4.25%.
An average rise in property values of $7,000 over the three months to November will give rise for optimism among sellers. That’s why we’re seeing a new wave of homes hitting the market.
Industry researcher CoreLogic says there are now more than 30,000 homes up for sales across New Zealand – a figure that would suggest to buyers the increasing supply and decreasing interest rate is giving them a market advantage.
It’s possible we’re going to experience a buyer’s market in the first half of this year, especially given economic concerns.
The 1% fall in GDP, which put NZ into recession, and increasing community concerns around job security will heighten sellers’ awareness that compromises may have to be made to get a buyer over the line.
Nevertheless, the Kiwi market finished 2024 on an upward trajectory, according to the Valocity report.
The average price of a NZ property is now $963,000.
Auckland’s average property value bucked its recent decline trend and recorded value growth of 0.9%. And the regions did well, too. Nine of them recorded value gains. The biggest disappointment was that prices are still edging lower in Wellington.
One of the big winners in the latest property survey is Hamilton, where values rose 3.1% to an average to $833,000.
We may have a two-speed market for now. The luxury segment is proving harder to attract buyers while there’s plenty of interest for entry-level and second homes. For example, West Coast, which is one of New Zealand’s more affordable areas, achieved a 2.6% increase in value. Homes rose $12,000 in value to an average $476,000.