Find a branch
Contact
Help
OPINION: The state of the country’s housing market appears to have fallen off the list of ‘hot topics’ - whether its concerns about supply, prices or affordability.
These issues appear to have drifted into the equivalent of an eddy, and we are awaiting for some development to break these topics free before yet again being the subject of intense speculation.
The latest OCR announcements from the Reserve Bank, which ultimately will determine where mortgage interest rates will sit through the first quarter of 2025 are unlikely to provide that push.
Current interest rates are already in the ‘affordable’ range, and any further falls will only be welcome rather than decision changers.
So just where is the housing market at present?
In terms of supply, it’s hard to argue that supply is a major issue. At the start of November, we had more than 5600 properties on our books. I have to go back into our records for 15 years to find a time when we had a greater number of homes for sale at the start of a month.
No matter where you look around the greater Auckland area there are new builds – both stand-alone and town houses – springing up everywhere. And while the issue of new building consents is declining, by former standards they are still healthy.
The various initiatives taken by the present and former governments, and various regulatory bodies, have seen big inroads made into the demand issue.
In terms of prices, the median sales price has retreated from its all-time highs of November/December 2021. After declining steadily for 18 months from peak price, prices bottomed in mid-2023, before rising and then declining again over the past 12 months.
Our current median sales price is sitting close to where it was at this time of the year in 2020, so price is not an insurmountable barrier to sales.
It is in terms of numbers of properties sold that the housing market is showing the most resilience. In the three months August to October this year we sold 2844 homes, which is 12% more than we sold in the same three months in 2023.
And compared to 2022, when the market was declining from peak prices, our sales for the months of August to October are 59% higher.
In fact, sales during this period this year are the second highest they have been for the last eight years. [in 2020 sales were 3473.]
In terms of sales numbers, it can be argued that rather than the proverbial green shoots, sales are maturing into strong limbs.
From here the housing market can look forward to a positive summer/autumn trading.
By historical standards prices are down, and stable. Interest rates have declined considerably, and the most likely future direction is down. And choice has rarely been better, with good supply acting as a handbrake on potential price increases.
Given the tumultuous ups and downs the market has experienced over the past decade, the political, regulator and commentator anxiety expressed about where it was heading, and the constant fine tuning applied to the way it operates, the present state of market stability is a welcome change.
Long may the market’s orderly recovery prevail.