The NZ property market is remarkably resilient, real estate boss says
Better-than-expected real estate statistics for February, plus the easing of controversial lending rules will only help autumn performance, said Tim Kearins, owner of Century 21 New Zealand.
His comments follow the release of REINZ’s Monthly Property Report for February which noted a 13.5% increase in median house prices across New Zealand for the month compared to the same time last year. REINZ noted that while property prices remain firm, supply now outweighs demand.
Now at $885,000, the national median house price is slightly up on the previous month by 0.6%.
Kearins said the summer was badly affected by the Credit Contract & Consumer Finance Act (CCCFA) coming into effect on Dec. 1, prompting the biggest credit crunch since the Global Financial Crisis in the late 2000s.
Read more: CCCFA changes lead to exodus of first home buyers
“Summer started with the CCCFA changes taking effect. It required banks to conduct ultra-conservative assessments on all new borrowers, with new mortgages all but drying up for three months,” he said. “Last week’s announcement that the government is making some significant tweaks to the CCCFA gives the coming months a timely boost.”
Read next: Government tweaks controversial CCCFA lending laws
The number of residential property sales nationally declined 32.8% in February, from 8,324 in February 2021, to 5,597. The total number of properties available for sale nationally also rose 47%, from 15,829 in February 2021 to 23,270.
“Summer was light on sales industry-wide but with listings lifting, and now with improvements to the lending rules, we’re seeing a lot of real estate activity move out to March and April,” Kearins said. “Autumn is off to a better start, with those vendors keen to strike a deal now adjusting their sights somewhat.”
The Century 21 boss said New Zealand’s residential property market is remarkably resilient when a number of external factors negatively impacting consumers and their confidence are considered.
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“Against the odds, February showed that overall property prices continued to climb albeit at a more moderate pace,” Kearins said. “Let’s not forget that despite plenty of doom and gloom, February saw six regions and 23 territorial authorities achieve record median prices. It is a much better end to summer than most had anticipated.”