House prices are continuing to ease as we enter 2023, though the pace of the decline is steadying and the market has glimpses of a new life, REINZ’s January data indicates
“January is traditionally a slower month as sellers and buyers are on holiday,” REINZ Chief Executive, Jen Baird says.
“This month is no exception, although intensified in Auckland by relatively poor weather, with the least number of sales since records began (excluding April 2020 during the country’s lockdown) at 943 sales. The rest of the country has also seen a record low for the month with less than 3,000 sales (2,759) nationally.”
High interest rates, the ability to secure finance, commentary around a looming recession and this being election year can be added to factors for slow decision making from buyers. As a result, properties are spending longer on the market with 53 being the median days to sell for January 2023, 16 days longer compared to January 2022.”
The median sale price has decreased nationally by 13.3% overall to $762,500 and decreased 9.3% for New Zealand excluding Auckland to $679,000. The REINZ House Price Index (HPI) showed an annual decrease of 13.9% in the value of residential property nationwide which is in line with the sale price changes seen.
Regional median house prices continue to decrease across the board, with Auckland dropping under $1,000,000 (to $940,000) in January 2023 for the first time in two years. The exception is three regions which saw marginal increases: Gisborne (+3.8%), Taranaki (+0.8%) and the West Coast (+5.3%). These were the only regions to see a rise in median price compared to January last year.
Nationally new residential listings decreased 16.0% year-on-year from 7,912 in January 2022 to 6,646 in January 2023 and increase of 28.9 month on month from December 2022. New Zealand excluding Auckland saw a decrease of 10.4% year on year from 5,512 in January 2022 to 4,635 new listings in January 2023 and a 29.4% decrease from 3,381 listings month on month from December 2022.
“The flip side to this is the seasonal effect of January. In seasonally adjusted terms, this month’s numbers show a January that performed better than expected. The sales counts are down for January 2023 compared to December 2022 for Auckland by 31.5%. When the seasonality is removed, the sales count numbers show Auckland performed 19.4% better than expected when compared to December.”
“Reports of more activity in the market are growing “Agents in many areas are reporting more attendance at open homes, more interest online and even more multi-offer situations. Inventory has increased 39.4% year-on year, now sitting at 27,732 properties which provides plenty of choice for buyers. Add to that prices that have eased over the last 12 months, and some less bad economic news coming out recently, it seems there are more buyers active in the market. February and March data will tell us if they choose to act” adds Baird.
“This is interesting data and does indicate a slowing of the decline. The coming months will be telling as the country braces for more activity both in the weather and the property market,” concludes Baird.
“Salespeople around the country say owner occupiers remain active, and that there has been increased interest in out-of-town buyers looking in different regions. Sellers are tending to be more realistic and will usually meet the market through negotiation — however, many remain cautious with properties taking longer to sell, and investors sparse.”
Century 21 New Zealand Owner Tim Kearins says these latest figures show that the pace of price decline is steadying, and January also saw an overall awakening of the market.
Nationwide sales numbers were well down across the industry, but there are plenty of positive signs that things have stabilized somewhat, with many reporting improved numbers at open homes and more multi-offers.
“Yes it’s a much quieter summer than we’ve seen in recent years, but our Century 21 agents and offices are still reporting plenty of successful transactions, with many great properties still making good money,” he says.
The fact that the time it takes to sell has lengthened out somewhat is unsurprising as buyers are cautious.
“This makes complete sense when you consider all the talk around an imminent recession, the fact that it’s harder to secure finance, higher interest rates, not to mention it’s election year which stalls decision-making,” he says.
All eyes will be on the next Official Cash Rate decision next week – on Wednesday, 22 February.
“More buyers are certainly starting to emerge. February and March’s statistics will show us if they’ve decided to press play. The good news is vendors are increasingly keen to meet the market as they know this is likely to be a difficult winter,” says Kearins.
Fact sheet
National highlights
- January data shows the median price in most regions has decreased
- Nationally, the median price for residential property decreased 13.3% annually to $762,500 and decreased 9.3% for New Zealand excluding Auckland to $679,000.
- Nationally, there was a 16.0% decrease of new listings from 7,912 in January 2022 to 6,646 new listings in January 2023 and an increase of 28.9% compared to December 2022.
- The number of residential property sales across New Zealand decreased month-on-month by 38.7%, and 27.0% year-on-year.
- The median number of days to sell a property in January 2023 was 53 — 16 days longer than in January 2022.
- The REINZ House Price Index (HPI) for New Zealand showed an annual decrease of 13.9% in the value of residential property nationwide — a 0.2 percentage-point difference from December.
- At the end of January 2023, 27,732 properties were available for sale across New Zealand — an annual increase in inventory of 39.4% for New Zealand. For New Zealand excluding Auckland there was an annual increase of 55.9% (17,781 properties).
Regional highlights
- Wellington, Auckland, Northland, and Bay of Plenty had the largest drop in median sale price with -16.4%, -21.7%, -16.6%, and -18.8% respectively.
- Gisborne, Taranaki and West Coast were the only regions seeing an increase in the median sale price, up 3.8%, 0.8% and 5.3% respectively.
- The Thames-Coromandel District reached a record median of $1,450,000.
- Median sales prices in the regions for January (year-on-year) have dropped overall (except Gisborne, Taranaki and West Coast):
- Northland: median price decreased 16.6% to $685,000
- Auckland: median price decreased by 21.7% to $940,000
- Waikato: median price decreased by 5.7% to $773,000
- Bay of Plenty: median price decreased 18.8% to $765,000
- Gisborne: median price increased by 3.8% to $675,000
- Hawke’s Bay: median price decreased by 16.2% to $657,500
- Taranaki: median price increased by 0.8% to $635,000
- Manawatu/Whanganui: median price decreased by 12.6% to $520,000
- Wellington: median price decreased by 16.4% to $765,000
- Nelson/Marlborough/Tasman: median prices in the Nelson, Marlborough and Tasman regions decreased by 11.3%, 7.1% and 12.8% to $670,000, $650,000, and $775,000 respectively
- West Coast: median price increased by 5.3% to $360,000
- Canterbury: median price decreased by 1.5% to $640,000
- Otago: median price decreased by 11.6% to $645,000
- Southland: median price decreased 2.1% to $420,000.
More information on activity by region can be found in the regional commentaries visit the REINZ’s refreshed website.
Median Prices
Our two biggest cities have seen ongoing declines in year-on-year median prices for the beginning of 2022.
There were three TA record median prices this month (Thames-Coromandel in Waikato hitting $1,450,000; Hurunui reaching $785,000 and Timaru $535,000, both in Canterbury).
Four of the past 12 months have been record prices in Thames-Coromandel District and, in differing months, Hurunui District. This makes them the TA’s to have seen the most record price months in the past year.
Sales Count
January 2023* recorded the lowest sales count in:
- New Zealand, NZ excl. Auckland, Auckland, Bay of Plenty, Gisborne, Hawke’s Bay, Marlborough, Nelson, Otago, Taranaki and Wellington since records began
- Canterbury since September 2010 (this month is the second lowest since records began)
- Manawatu/Whanganui since December 1995 (this month is the second lowest since records began)
- Northland and Waikato since January 2011 (this month is the second lowest since records began)
- Southland since December 1999 (this month is the second lowest since records began)
- Tasman since January 2000.
In addition to the above, in terms of the month of January, this January saw the lowest sales count in:
- Tasman since 2000
- Northland and Waikato since 2011
- West Coast since 2022 (i.e., last year)
- All other regions since records began.
*Excluding the two lockdown-affected months of April 2020 and May 2020
All regions’ sales counts (except for West Coast) dropped since January 2022 and all regions except West Coast had a decrease on December 2022
Days to Sell
All regions had an increase in median days to sell since December 2022 and all regions had an increase in median days to sell since January 2022.
January 2023* had the highest median Days to Sell in:
– Wellington since February 2009
– NZ since February 2011
– NZ excl. Auckland since May 2011
– Otago since July 2011
– Waikato since February 2013
– Tasman since July 2013
– Gisborne since February 2015
– Marlborough since June 2015
– Southland since July 2015
– Taranaki since January 2018
– Canterbury since January 2020
-Auckland and BOP since June 2020
* Exclude the two lockdown-affected months of April 2020 and May 2020
In terms of the month of January, the last time the median days to sell was higher in:
• NZ and NZ Excl. Auckland was in 2011
• Nelson, Otago and Wellington was in 2009
• Marlborough, Tasman and Waikato was in 2012
• Gisborne, Hawke’s Bay and Southland was in 2014
• and Bay of Plenty and Manawatu/Whanganui was in 2015.
House price index (HPI)
Wellington now has fifteen months in a row of being in the bottom two ranked regions (last fourteen as worst-ranked) for the year-on-year HPI movement.
New Zealand, New Zealand excluding Auckland, Bay of Plenty and Manawatu/Whanganui saw their largest year-on-year drops in HPI since records began.
Auckland and the Nelson/Marlborough/Tasman/West Coast regions had their third largest year-on-year drops in HPI since records began.
Taranaki is the top-ranked HPI year-on-year movement this month. Otago is second and Southland is third.
Inventory
Eight of fourteen regions (57%) had at least a 60% year-on-year increase in inventory
Listings
Nationally new residential listings decreased 16.0% year-on-year.
Regionally, all but four regions (Canterbury, Nelson, Southland, and Taranaki) have had a decrease in listings compared to January 2022.
Over half of the regions have had listings decrease by more than 15% year on year.
Inventory and listing data come from realestate.co.nz.
Auctions
Nationally, 3.7% (101) of properties were sold at auction in January 2023, compared to 14.1% (532) in January 2022.
New Zealand excluding Auckland saw 2.8% of properties (35) sell by auction compared to 1.6% (162) the year prior.
More information on activity by region can be found in the regional commentaries visit the REINZ’s refreshed website.
