Market warms slightly with a 1.1% increase in Q1
The New Zealand housing market experienced a gentle uptick in the March quarter of 2024, with CoreLogic's House Price Index recording a 0.5% increase in March, mirroring the modest gains of January and February.
This brings the first quarter growth to 1.1%, setting the average property value across New Zealand at $934,806. Despite this increase, values remain 10.4% below the recent peak.
The recovery has been uneven across regions, with Wellington showing a notable increase of 0.9%. Christchurch, Dunedin, and Auckland (0.4%-0.6%) also posted gains, albeit more modestly, while Tauranga and Hamilton experienced slight declines (-0.2%).
“NZ’s housing market can probably be described as ‘not too hot, not too cold,’” Kelvin Davidson (pictured above), CoreLogic NZ’s chief property economist, said in a media release.
Davidson pointed out high mortgage rates as a significant challenge, alongside cautious anticipation for the official cash rate cut, potentially not starting until next year.
He also highlighted the increase in listings in early 2024, suggesting a shift in the market dynamics in favour of buyers.
“There’s no set definition, but the general sense is that the so-called sellers’ market of late 2023 has now switched back in favour of credit-approved purchasers,” the CoreLogic economist said.
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Auckland’s mixed signals
Auckland’s market showed considerable variability, with some areas like Rodney and North Shore experiencing growth, while others remained stable or saw declines.
“Auckland's market is often seen as a bellwether for national trends... an ‘up and down’ recovery,” Davidson said.
Wellington’s diverse performance
Wellington too demonstrated varied performance among its suburbs, with some areas like Upper Hutt spiking in March, whereas others like Lower Hutt and Porirua saw decreases.
“It’s interesting to note the falls from the peak remain pretty large in Wellington, even after recent growth," Davidson said.
Regional roundup
The regional landscape was equally mixed, with some areas enjoying growth of at least 1%, while others like Gisborne and Queenstown experienced declines. Despite this, some regions have seen their annual house price growth rates turn positive.
“It’s no surprise that some regions are rising more strongly than others in this current ‘testing’ market, while some are still actually falling,” Davidson said. “The general trend should remain upwards in the coming months, but it's unlikely to be a straight line everywhere.”
Looking forward
Davidson cautioned that while sales volumes and property values are expected to rise, the market’s recovery is likely to remain uneven.
“March’s subdued property value data is a timely reminder that this upturn may well be inconsistent,” he said, highlighting the varied buyer activity and the cautious optimism for the future.
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