"The mood of the market is warming," spokesperson says
January heralded a spirited beginning for the New Zealand property market, marked by notable milestones and a resurgence of activity, according to realestate.co.nz’s New Zealand Property Report.
Vanessa Williams (pictured above), spokesperson for realestate.co.nz, said the positive start to the year presents opportunities for both buyers and sellers.
“The mood of the market is warming. 2023 was the year of market correction, with low listings and fluctuating prices,” Williams said. “At the start of 2024, we are seeing new energy, including record price growth in the South Island.”
Average asking prices show an uptick
In January, prices began to rise across more than half of New Zealand’s regions compared to the previous year. While some areas experienced slight declines, the decreases were minimal.
“None of the regions that experienced a drop in average asking prices year-on-year saw declines greater than 10%, indicating stability in the market,” Williams said.
The surge in average asking prices was primarily fuelled by regional centers. Remarkably, areas like Central Otago Lakes District, Coromandel, Marlborough, Northland, Otago, Southland, and Wairarapa experienced year-on-year and month-on-month increases.
Setting a national record, Central Otago Lakes District's average asking price surpassed $1.6 million for the first time, with homes in this renowned Pinot Noir region now averaging $1,621,899, reflecting a 19.3% increase from January 2023.
Southland, the second most affordable region in New Zealand, also reached a 17-year record average asking price high. With an average asking price of $555,173, homes in Southland are priced at approximately one-third of those in Central Otago Lakes District.
Lifestyle preferences: Auckland vs. Central Otago Lakes District
Despite being New Zealand’s economic powerhouse, Auckland currently isn't the nation’s most expensive location to purchase property. Instead, Central Otago Lakes District has consistently commanded the highest prices over the past five years, with only brief periods where Auckland surpassed it, notably in June 2021 and January 2022.
Williams noted a surge in interest in the Central Otago Lakes District. In January, property seekers on realestate.co.nz searching for properties in the area increased by 39.6% compared to December and by 43.2% compared to January 2023. Notably, Cromwell emerged as the most searched suburb, followed by Wanaka. Searches originated from people in Auckland, Christchurch, and Sydney, Australia.
She said the increased activity underscored the significance of lifestyle factors for property seekers.
“It's fascinating to see how, not long ago, in mid-2021, Auckland and Central Otago Lakes were at a similar price point of around 1.2 million,” Williams said. Since then, Auckland's prices have dipped, while Central Otago Lakes’ have climbed.
“The price gap between the regions illustrates the unique appeal of lifestyle areas like Central Otago Lakes and Coromandel over major urban centres like Auckland. The data tells us that when Kiwis look to buy property, lifestyle is a major consideration.”
Surge of new listings nationally
After a year of subdued listing numbers, January witnessed significant growth in new listings across 11 of 19 regions.
Wairarapa (42.9%), Coromandel (26.4%), Auckland (22.4%), Marlborough (19.0%), Hawkes Bay (18.4%), Manawatu/Whanganui (17.8%), Northland (16.6%), and Central North Island (13.8%) experienced substantial year-on-year increases, surpassing the national average.
Conversely, Gisborne, West Coast, and Otago saw their lowest January listings since realestate.co.nz records began 17 years ago, with declines of 20.5%, 27.1%, and 7.6%, respectively.
Month-on-month, the beginning of the new year brought about a remarkable shift in market dynamics. Following a subdued December, realestate.co.nz data revealed a staggering 52.2% surge in new listings nationally, far surpassing the average 23.7% increase typically observed over the past five years between December and January.
“This upswing in new listings nationally, along with heightened activity in regions like Wairarapa and Auckland, is a clear signal of renewed seller confidence and market vitality,” Williams said.
Auctions trump display prices
In January, vendors' choice of listing method reflects market confidence. Auctions are regaining prominence, rising 38.1% year-on-year to reclaim their status as the preferred pricing strategy for vendors, following a festive break hiatus.
Williams explained that the increase in auctions reflects vendors’ preference for the transparency and competitive advantage offered by this sale method.
“It's a sign of sellers’ optimism and a belief in the strength of the current market, as they lean towards a method that can often bring about quicker sales,” she said.
Property demand increases
The beginning of the year witnessed a surge in property demand. Nationally, searches per listing increased by 21% compared to December and 14.2% compared to January of the previous year. This upward trend was also reflected in engagements, with a 25.3% rise in saved properties and email enquiries compared to December, and a 21.9% increase compared to the same period last year.
Williams said the substantial uptick in demand signifies a renewed interest from buyers entering the market at the start of the year.
“Seeing such enthusiasm from buyers nationwide is encouraging, suggesting a strong start to the year and a positive outlook for the property market ahead," she said.
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