Hot Property - Autumn 21
It was a summer of breaking records in real-estate, says Bindi Norwell, then CEO of the REINZ. She says something has to change.
5 October 2021
For four months in a row, New Zealand has seen house prices reach new records, with December 2020 seeing a new national median house price of NZ$749,000.
As well, 11 regions and 27 districts saw record high median prices. This is a continuation of what we’ve seen in the housing market for the last few months.
These price rises highlight how strong the residential housing market is across the country.
I believe we urgently need a combined response from Government and industry to solve the housing affordability issues we’re facing.
Currently, we have half the inventory levels we had back in December 2018 – there are simply not enough houses on sale to satisfy demand.
This has reduced choice for potential purchasers and has put huge pressure on house prices in most parts of the country.
With record low interest rates around, people are willing to compete to secure a property.
This lack of choice is also leading to properties being sold at the fastest pace we’ve seen in 17 years.
Across the country, 14 out of 16 regions had a median number of days to sell of less than 30 days –only Northland and the West Coast were exceptions.
The median number of days to sell a house nationally is just 27 days, showing how people are moving quickly to secure ‘good’ properties.
December 2020 saw 8,935 properties sold, which is 2,392 more houses than in December 2019. That’s an additional 77 properties sold every single day in December.
Similar to what we’ve seen in the past few months, with market confidence high and ‘fear of missing out’ (FOMO) in full swing, buyers are likely to be keen to purchase ahead of further expected price rises and the re-introduction of loan-to-value ratios for lending.
That means I would expect that the housing market will be busy for the next few months.
However, if we don’t see more houses coming on sale, we may start to see this have an impact on sales volumes going forward.
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