Buyer's market emerges
Latest data from the OneRoof-Valocity House Value Index revealed how high listing volumes and persistent high interest rates are influencing New Zealand’s property market.
The average property value nationally has inched up by 0.4% to $977,000 over the last three months, despite market fluctuations driven by increased listings.
Buyer’s market emerges amid surplus listings
The influx of property listings, increasing by 30% year-on-year, has shifted market dynamics, favouring buyers over sellers. This surge has not been fully matched by sales volumes, which rose by 19%, indicating a slower absorption rate.
“Feedback from agents suggests vendors are adjusting price expectations and seem more motivated to meet the market,” according to the latest OneRoof report.
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Regional variations highlight diverse market responses
While property values in Auckland and Bay of Plenty have slightly declined, Canterbury and Wellington saw muted growth of around 1%.
The West Coast experienced a significant jump of 6.3%, increasing the average property value by $28,000. Conversely, Gisborne’s market felt the lingering effects of Cyclone Gabrielle, with a 3% decrease in property values.
Interest rate cuts could shift dynamics
The current hesitation in the property market is expected to impact growth margins, but upcoming cuts in the OCR could revitalise vendor prospects.
“When interest rates start to drop – expectations are for cuts in the OCR at the end of this year or the start of next – power in the market may shift back to vendors,” the report said.
Local hotspots and cold spots
Dunedin reclaimed its status as a housing market standout, with a 3% increase in property values this quarter. In contrast, major metros like Auckland saw minimal or negative growth.
Notably, some suburbs, especially in wealthy areas, experienced significant value changes. Whitford led with a $160,000 increase in average property values, while Tamahere saw the largest drop, with values decreasing by $64,000.
Market sentiment and actions
With more than 41,000 homes listed for sale on OneRoof.co.nz, an increase of 17% from last year, the market is teeming with options for cautious buyers, who may be influenced by recent easing of lending restrictions. This could trigger a more active market as economic conditions evolve.
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