The New Zealand market is stuck in a bit of a groove right now. We’re continuing to see price stability nationwide with in-demand areas strengthening, while the stragglers struggle to gain buyer traction.
Happy owners include those in Arrowtown in the Queenstown-Lakes, which has seen values rise an average $178,000 in six months, and those in Christchurch, where property is now 1.6% more expensive than at the beginning of the year.
Wellington owners, however, have seen a fall of 1.3% over the same period. This unwelcome news is a reflection on the local economy, where government redundancies have been a significant feature.
Its average price of $851,000 reflects a value growth over the past five years of less than 10%.
The latest OneRoof-Valocity House Index indicates prices are yet to move significantly higher across New Zealand despite the number of sales increasing.
Given the Official Cash Rate (OCR) has fallen from 5.25% to 3.25% since September 2024, the lack of market response shows continuing concern on the economy, job security and cost of living.
As a result, sellers remain reticent. OneRoof says the number of dwellings on the market is 5% down on the same period last year.
Meanwhile, the Real Estate Institute of New Zealand says sales in the first six months of the year are 12% up on 2024 figures. Transactions were also 8.9% higher year-on-year in May, indicating the housing stock may begin to decline.
The hot suburbs are now feeling the chill of winter. The new OneRoof data says the biggest six-monthly increases have been in Moana (10.2%), Mataura (7.4%) and Arrowtown (6.3%). As the year has progressed, these growth rates have tapered down.
OneRoof has also analysed data to find that 83 suburbs hit their post-Covid peaks in the last six months, and another 65 are less than 5% off this benchmark.
Canterbury’s value average stands at an all-time high of $798,000, and Christchurch is $3000 short of its post-Covid peak of $802,000.
Despite the mixed messages coming from today’s market, the prevailing view is that prices are flat and sellers will need to adjust their strategies. Here are seven tips:
Pricing is crucial – In today’s market, overpricing is a significant mistake. While declining stock might suggest less competition, flat prices indicate buyer demand isn’t strong enough to drive values up. An overpriced property will sit on the market longer and potentially lead to an eventual price reduction.
Experience counts – Sellers need to work with a knowledgeable agent to conduct a thorough comparative market analysis (CMA) and price the property realistically from the outset.
Buyer psychology: Flat prices suggest buyers aren’t feeling any sense of urgency. They might be more cautious, waiting for prices to drop further, or for more options to emerge. So, focus on making your property an undeniable choice.
Strategic marketing – Putting your property in front of the right buyers is critical. Work with your agent on a comprehensive marketing plan that should include professional photography, a video tour and social media campaign.
Value Proposition – Buyers in a flat market are likely to be more discerning. Sellers should invest in cost-effective upgrades, such as repainting the interior and exterior, installing modern fixtures, decluttering, and commissioning professional cleaning and staging.
Your goals – It’s easy to sit on the sidelines, but there are two sides to your transaction. Once you’ve sold, you’ll be a buyer. If you’re an upsizer, you’re going to get better value for money today than if you wait for the market to rebound.
Be patient – Adjust any expectation for a quick sale and be prepared to negotiate.