12-06-2012

REINZ May 2012 regional review

Landlords.co.nz

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Auckland see an almost 30% surge in sales and a new all time price high, sales up in Wellington but prices slip and Taranaki sees strongest sales rise for five years.

By Benn Bathgate

Auckland

Sales volume across the Auckland region increased by almost 30% in May compared to April, and also increased by almost 28% compared to May 2011. Volume increases were strong across the region, with only Waitakere City showing a slower increase than the other parts of the region.

The median price hit a new all time high of $500,000 in May, up $4,800 (+1%) on the previous high recorded in March. Prices rose by 7.8% across the region compared to May 2011, with Auckland City seeing the median price increase by almost 10%, and North Shore City by more than 8%.

Auckland's days to sell remained steady at 33 days in May, and improved by three days compared to May 2011. The Auckland region's days to sell were equal shortest across the country with Canterbury/Westland in May.

REINZ Chief Executive Helen O'Sullivan commented that, "The Auckland market had a strong month in May, with a sizeable lift in volumes and a new record median high. First home buyers and investors are active in the market at lower price levels, but the real driver of these results is the shortage of housing.”

All three trend measures for Auckland are rising, with the trend in the median price the strongest mover, followed by volumes and the number of days to sell. Auckland is the second strongest housing market in the country after Canterbury/Westland.

Wellington

The median price for the Wellington region eased by $11,750 (-3.1%) compared to April and by $6,250 (-1.7%) compared to May 2011. Prices were noticeably weaker in Central Wellington and Wairarapa, but were also stronger in Eastern and Western Wellington.

Sales volumes increased by 28.5% compared to April and by almost the same amount compared to May 2011. Sales volumes were strong in most parts of the region, although were noticeable weaker in Southern Wellington and Upper Hutt. Volumes were particularly strong in Eastern and Western Wellington.

Wellington's days to sell eased by one days from 41 days in April to 42 days in May. Compared to May 2011 the number of days to sell improved by five days from 47 to 42 days.

REINZ Chief Executive Helen O'Sullivan noted that, "the Wellington region is seeing continued weakness in prices, reflecting the cautious approach being adopted by buyers in the region. There is a good supply/demand balance for houses, although there remains a significant oversupply of apartments in Wellington City."

The trend in the median price continues to ease with the May median below the trend line. The trend in the number of days to sell continues to improve, albeit at a more modest pace than previously and volumes, despite the strong lift in May, continues to trend only marginally upward. Wellington remains New Zealand's weakest housing market.

Northland

Sales volumes across the Northland region increased by 15% compared to April and by almost 13% compared to May 2011. Both Whangarei City and Whangarei Country saw near 50% increases in sales volumes compared to April, with total sales across the region slightly higher than March, normally the peak.

The median price across the region eased by $10,000 (-3.4%) in May compared to April, and by $5,000 (-1.8%) compared to May 2011. Prices in Whangarei Country fell by over 37% in May compared to April, although prices rose by over 42% in April.

Northland's days to sell increased by 19 days in May compared to April, from 48 days to 67 days, although there was a 12 day improvement compared to May 2011 (79 days vs 67 days). Overall the days to sell trend continues to improve.

REINZ Chief Executive Helen O'Sullivan commented, "The Northland market is seeing a steady lift in the number of sales, and improvements in the number of days to sell, but this has yet to translate into prices. This suggests that there is plenty of activity at lower price points.”

The trend profile for the Northland region remains unchanged compared to April with prices continuing to ease, but with the volume and days to sell trends improving.

Waikato/Bay of Plenty

Sales volumes across the region rose by almost 18% compared to April and by almost 12% compared to May 2011. Only Rotorua and Taupo saw negative volumes compared to April, with all other parts of the region showing double digit growth. Tauranga and Mt Maunganui/Papamoa were particularly strong in May compared to April.

The median price across the region eased by $4,000 (-1.3%) compared to April, with the same decline compared to May 2011. Movements in prices across the region were mixed with only Eastern BOP Country showing a sustained increase in prices, although both Taupo and Gisborne saw double digit declines.

The region's days to sell improved by two days, from 55 in April to 53 in May, and by 11 days compared to May 2011. The overall trend in the number of days to sell continues to steadily improve.

The trend in volumes continues to rise, with results over the past few months ahead of the trend line. Days to sell continue to improve, although the median price continues to trend sideways in a relatively narrow band.

REINZ Chief Executive Helen O'Sullivan commented that, "the trends in the Waikato/Bay of Plenty region are in line with what is happening outside the two 'hot' markets of Auckland and Canterbury where there is plenty of activity at lower price levels, but the markets remain soft for more expensive properties. This has the effect of keeping a 'lid' on the median price in these markets."

Hawkes Bay

The Hawkes Bay region saw a 44% increase in sales volume compared to April, with the lift in sales spread across the region. Compared to May 2011 sales volume increased by 21%. Over the 12 month period sales in Hastings City rose by almost 40%, but only by 8.5% in Napier City.

After hitting a new record median price of $296,000 in April, prices eased back in May, with the median price falling by $25,000 (-8.4%) to sit just below the trend line. Compared to May 2011 prices rose by $3,000 (+1.1%), with the lift in Hastings City being offset by the fall in Napier City.

The number of days to sell eased again in May, by a further three days, from 48 days to 51 days. This compares with 58 days recorded in May 2011. The trend in the days to sell continues to move sideways indicating that one could expect a house sale to take around 50 days.

Despite the pull back in the median price this month, the underlying trend in the median price continues to improve. Sales volumes are also continuing to trend higher, indicating that the overall trend in the Hawkes Bay region continues to improve.

REINZ Chief Executive Helen O'Sullivan commented that, "the Hawkes Bay region is continuing to improve, although there is still a shortage of listings. Open home attendances remain steady in Napier and Hastings."

Manawatu/Wanganui

The median price for the region increased by $10,000 (+4.6%) in May, partially reversing a $12,500 decline in April. Compared to May 2011 the median price eased by $2,000 (-0.9%). Although the median price across the region rose in May prices did ease in Palmerston North and Feilding. There was a noticeable lift in prices in Wanganui.

Sales volume across the region increased by almost one third in May compared to April, although compared to May 2011 the increase in sales volume was a more modest 5.7%. Levin saw a modest increase in sales volume compared to April, but again recorded triple digit increases compared to 12 months ago.

The number of days to sell improved by two days, from 55 days in April to 53 days in May. Compared to May 2011 the number of days to sell has improved by nine days from 62 to 53. Despite these improvements the underlying trend in the number of days to sell remains essentially flat at just over 50 days.

REINZ Chief Executive Helen O'Sullivan noted that, "the easing of the median price in Palmerston North is indicative of an active market below $280,000 with a shortage of listings, and a less active market above $300,000. This 'two speed' market is a common feature of many centers at the moment."

Across the region the median price continues to trend sideways within a relatively narrow band, the number of days to sell is also trending sideways. Although volumes are rising, the trend appears to have eased back in the past few months. Overall the region continues to be steady.

Taranaki

The median price across the Taranaki region increase by almost 12% in May, although this came after a 9% fall in April. Compared to May 2011 the median price across the region increased by almost 10%, giving Taranaki the largest increase for any region compared to both April and May 2011.

Continuing the theme, Taranaki also recorded the strong increase in sales volumes compared to April, with an increase of just over 60%, although the increase compared to May 2011 was more modest at 12.4%. All parts of the region recorded double digit increases compared to April, with New Plymouth seeing a 74% increase in sales.

The strong increase in sales in May saw Taranaki record its highest number of sales since March 2007, when 246 sales were recorded. The number of days to sell eased by nine days in May, from 49 days in April to 58 days in May.

Compared to May 2011 the number of days to sell improved by six days.

Despite the strong lift in the median price in May the underlying trend for prices across the region remains flat, with quite some volatility on a month to month basis. The trend in the number of days to sell is now back at its trend line of 58 days. The trend in volumes is moving slowly higher, despite the strong sales in May.

REINZ Chief Executive Helen O'Sullivan noted that, "the Taranaki region scored a number of firsts this month, and recorded the strongest level of sales for more than five years, which is certainly encouraging for the region."

Nelson/Marlborough

The median price across the region in May eased by $3,500 (-1%) compared to April, by increased by $500 (+0.2%) compared to May 2011. Prices rose noticeably in Richmond, but were mixed elsewhere in the region.

Sales volumes increased by one quarter in May, after pulling back sharply in April, although compared to May 2011 sales volumes were only up a little less than 4%. Compared to April sales volumes were strong in Motueka and Nelson City, although compared to May 2011 only Motueka saw any significant increase in sales volume.

The number of days to sell in the Nelson/Marlborough region eased by six days in May compared to April; from 43 to 49 days. Compared to May 2011 the number of days to sell improved by eight days, from 57 to 49 days. The trend in the number of days to sell, which had been improving, has now flattened out and is trending sideways.

REINZ Chief Executive Helen O'Sullivan commented that, "Agent reports suggest that the lift in sales volume in Nelson in particular reflects continued buyer interest from Christchurch. Although this was expected to eased with the arrival of autumn this does not appear to have been the case."

The trend in the median price remains flat, as does the trend for sales volumes and for days to sell. Overall the trend across the region is sideways.

Canterbury/Westland

Sales volumes in the Canterbury/Westland region increased almost 28% in May compared to April and by 56% compared to May 2011. May was also the first month that sales volumes have exceeded 1,000 since March 2009. Sales volumes in Christchurch City were up nearly 32% in May compared to April.

The increase in sales volume is being driven by three broad groups; first home buyers, Red Zone buyers and investors, who are entering the market in increasing numbers as rentals move higher. Further out across the region there is still strong sales growth in Rangiora and South Canterbury.

The median price across the region increased by $14,000 (+4.4%) compared to April and by $27,000 (+8.8%) compared to May 2011 to reach the all time record high recorded in November 2011. The 8.8% year on year increase was the second strongest after Taranaki in May. Prices in Christchurch City have risen, but not as strongly as the regional result with Rangiora continuing to be the strongest centre in the region.

The number of days to sell eased by three days, from 30 days in April to 33 days in May, although there was an eight day improvement compared to May 2011. The trend in the number of days to sell continues to improve.

Canterbury/Westland continues to rank as New Zealand's strongest property market with a clear uptrend in prices (more so than Auckland, although not by much), strong sales volume growth and continued reductions in the number of days to sell.

Central Otago Lakes

The median price for the Central Otago Lakes region fell by $53,000 (-11.3%) in May, compared to April, reversing the sharp lift in prices seen in April. Compared to May 2011 the median price has increased by $15,000 (+3.7%). Both rises and falls have been spread evenly between Central and Queenstown.

Sales volume increased by almost 8% compared to April, well below the national increase of 26.4%. All of the increase occurred in Queenstown, with Central seeing a pull back in the number of sales. Compared to May 2011 the number of sales was up almost 32%.

The number of day to sell eased by four days in May to 63 days compared to 59 days in April. Compared to May 2011 the number of days to sell improved by 26 days, from 89 to 63 days. Despite these large swings the overall trend in the number of days to sell remains steady at 63 days.

The trend in median prices remains flat, despite the large movements in recent months, with the current median price for the region about in line with the trend. The trend in sales volume continues to rise with a noticeable gap opening up between the monthly results and the trend line.

Overall the trend in the Central Otago Lakes region continues to be sideways.

Otago

The median price across the Otago region eased by $11,000 (-4.6%) in May compared to April, and by $6,000 (-2.6%) compared to May 2011. Prices eased in Dunedin, but were stronger in North and South Otago. Otago recorded the largest fall in median price for all regions compared to May 2011.

Sales volumes increased by just over 8% compared to April, although this was well below the national result of 26.4%. Compared to May 2011 sales increased by just over 18%, but this too was below the national result of 24.4%. Compared to April, sales eased slightly in Dunedin, but were strong in other parts of the region.

The number of days to sell for Otago remained steady in May at 35 days, although compared to May 2011 there was a 12 days improvement. The trend in the number of days to sell continues to improve. This is the third month in a row that the number of days to sell has been steady at 35 days.

REINZ Director Liz Nidd commented that, "the results in Otago reflect an increasing shortage of lower priced homes that would be attractive to first home buyers, in line with the trends that have been noted in other parts of the country."

The median price trend has flattened out over the past couple of months and is now moving sideways. The sales volume trend continues to rise, albeit modestly and the trend in the number of days to sell continues to improve. With the flattening off of the price trend the overall trend for the region has moved back to steady.

Southland

Sales volumes for Southland increased by 8% compared to April, and by just 1.3% compared to May 2011. Southland recorded the lowest increase in sales volume over the 12 month period of any region in New Zealand Sales were up just over 9% in Invercargill compared to April but were essentially flat in Gore.

The median price across the region eased by $6,000 (-3.1%) compared to April, but rose by $9,500 (+5.3%) compared to May 2011. The median price trend was mixed in Invercargill, but was more robust in Gore with a 25% increase in the median sales price compared to May 2011.

The number of days t sell in Southland reversed sharply in May with an increase of 17 days to 53 days compared to 36 days in April. Compared to May 2011 the number of days to sell also increased by 10 days from 43 to 53. Southland was the only region to see an increase in the number of days to sell compared to 12 months ago.

The median price trend continues to rise, albeit at a modest pace. The trend in sales volumes is now moving sideways and the days to sell trend has flattened off and is now starting increase. Overall the trend for the Southland region is flat.

Source: Landlords.co.nz