National Average Asking Price Holds Steady
The latest data from realestate.co.nz reveals that average asking prices remained stable throughout June, marking 18 consecutive months of unchanged prices nationwide. Despite a 2.6% decrease compared to May, total stock increased by 28.6% year-on-year, with the number of homes staying above 30,000 for the fifth consecutive month. New listings rose by 25.5% compared to June last year, indicating a return to normal levels after a dip in 2023.
This period of price stability comes amid new regulatory changes, including new debt-to-income ratios (DTIs), relaxed loan-to-value ratios (LVRs), and adjustments to the bright-line test and interest deductibility. Real estate agents report a backlog of properties waiting to be listed, particularly due to the updated bright-line rules effective from July 1. These regulatory shifts, combined with current market conditions, underscore the importance of thorough research for those transacting in the real estate market.
Stable prices can benefit prospective investment property buyers, but understanding local rental demand is crucial due to the abundance of available rental properties. Sellers, especially those affected by the shortened bright-line test, need to price their properties realistically, as they might face challenges in achieving their desired price.
Regional Price Movements
Southland experienced the most significant increase in average asking prices, up 12.1% year-on-year. However, after three months as the most affordable region, Southland was overtaken by the West Coast, where average asking prices dropped 13.6% month-on-month to $476,892. In Wellington, average asking prices rebounded by 10.9% month-on-month to $818,352, bringing the capital’s average back above $800,000 after a dip in May.
Prices in the Bay of Plenty, Manawatu/Whanganui, Waikato, and Wairarapa remained relatively static between May and June, with fluctuations of less than 1.0%.
Prices have fluctuated between $860,000 and $890,000 since November 2022, offering a degree of certainty for buyers and sellers in an otherwise uncertain economic environment.
Advice for Sellers
Sellers are advised to ensure their properties are well-marketed, work with experienced real estate agents, and understand local market insights and price expectations.
Rental Market Trends
The rental market saw a significant increase in new listings, up 26.9% nationally compared to June 2023. Although there was a 10.4% decrease from May’s unseasonal surge, this marks the second consecutive month of high new rental listings. Financial pressures on investors may be driving this surge, potentially leading to the conversion of short-term rentals and Airbnbs into long-term rentals.
Nationally, the average weekly rental price increased by 5.9% year-on-year to $653, with all regions except Wairarapa experiencing an increase. Month-on-month, the national average rental price remained stable, down just 0.9% from the record high of $660 in May. Notably, Waikato reached an all-time high rent of $572, marking record rental prices in three of the last four months. Despite the influx of new rental listings, average rental prices have not yet been significantly impacted.
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