The housing market has swung back firmly in favour of buyers, with the spike in listings numbers easing house price growth across the country.
Property values in most regions barely grew in the three months to the end of March 2024, and in two locations – Bay of Plenty and Gisborne – values dropped.
The pace of property value growth for New Zealand slowed to 0.5% ($5000) over the quarter, according to the latest figures from the OneRoof-Valocity House Value Index.
Auckland appears to be losing steam despite recording some high-profile sales in March, including New Zealand’s biggest highest auction sale price. The region’s average property value was up only 0.1% ($1000) to $1.33 million.
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However, the figures also pointed to an overall rebound in the market, with property values in 60% of the country’s suburbs up year-on-year.
The strongest lifts in the year to the end of March 2024 were in higher-value Canterbury suburbs, including Merivale and Fendalton, and low-priced suburbs in West Coast. Mataura, in Gore, however, enjoyed the biggest surge, with its average property value up 19.5% ($50,000) to $306,000.
The biggest dollar change year-on-year was in Merivale, where the average property value jumped $252,000 to $1.594m, on the back of strong sales activity in the second half of 2023.
According to the OneRoof figures, property values were up year-on-year in 481 New Zealand suburbs with 20 or more settled sales in the last year.
The figures stand in stark contrast to OneRoof’s house price figures for April 2023, which showed only 114 suburbs were up year-on-year (13% of those with 20-plus settled sales).
Christchurch and Queenstown-Lakes were the best performing major metros, with prices up year-on-year in every suburb in both centres. Dunedin and Wellington were close behind, with only a handful of suburbs in both down year-on-year.
However, the recovery appears to be taking longer in Auckland, Hamilton and Tauranga, where just over half of the suburbs were up.
The average property value in 21 suburbs (2% of the suburbs analysed) had reached or exceeded their post-Covid peak, with another 64 less than $10,000 shy of a full recovery.
The figures also show that property values in every suburb bar one – Totara Park in Manukau – enjoyed five-year growth. Prices in 11 suburbs were more than double what they were in April 2019.
OneRoof editor Owen Vaughan said the quarterly figures highlighted the impact of the sudden rush to market by vendors across the country.
"The total number of homes for sale on OneRoof at the end of March was just over 40,000 – up 13.5% year-on-year. New listings for the month were up 36% nationwide on the same period last year, and up 48% in Auckland," he said.
"The listings surge has given buyers a chance to pause and gives them more bargaining power than they had six months ago, when much less stock was on the market."
The swing to a buyer’s market has put the brakes on value growth. Joining Auckland in the slow lane are Canterbury (up just 0.8% in the three months to the end of March); Hawke’s Bay (+0.6%); Manawatu-Whanganui (+0.8%); Marlborough (+0.4%); Northland (+0.8%); Southland (0.2%); Taranaki (0.7%); and Waikato (no growth).
Otago, Tasman and Wellington all registered value growth of more than 1% over the quarter, but the star performer remains West Coast, where the average property value jumped 6.6% ($29,000) to $468,000.
Vaughan said Queenstown-Lakes continued to power ahead, with buyer activity in the wealthy district pushing up the average property value 2.5% ($50,000) to $2.03m in the three months to the end of March.
However, momentum has slowed from the 5% value growth registered in October. Market fatigue can also be seen in the value growth figures for the other major metros, with Tauranga actually suffering a drop for the first time in more than six months.
"At a suburb level, most of the biggest value jumps over the quarter are in the country’s most affordable region, West Coast, while the biggest drops can also be found at the affordable end of the market, in Gore and Kaipara," Vaughan said.
Helen O'Sullivan, Valocity global CEO of real estate, said uncertainty around the timing of interest rate cuts and muted economic activity were hindering house price growth. "Affordability remains a primary concern for borrowers. So far, most of the market rebound has centred around entry-level segment of the market," she said.
Valocity global CEO of real estate Helen O'Sullivan: "Affordability remains a primary concern for borrowers." Photo / Fiona Goodall
"The proposed changes to the bright Line test and interest deductibility may provide relief to existing investors, but it remains uncertain if the changes will entice investors to enter the market, particularly in the current high-interest rate climate."
