Inventory levels are now showing a return to standard levels - REINZ stats February 2023

Activity remains slow, housing stock levels return to regular levels

The Real Estate Institute of New Zealand’s (REINZ) February 2023 figures show a lesser rate of decline in annual median prices and sales counts, with stock levels returning to normal levels.

REINZ Chief Executive Jen Baird, says the impact of ongoing economic headwinds and Cyclone Gabrielle is reflected in the numbers, but some data in the housing market returns to ‘normal’ amidst a big clean-up job across the upper north and eastern North Island.“

February traditionally shows a reasonable month of activity but the impact of extreme and devastating weather over the start of 2023 is certainly showing in the data with sales and listings significantly down in affected areas. We may continue to see this for some time in parts of Northland, Auckland, Tairāwhiti Gisborne, Hawke’s Bay, Coromandel and Bay of Plenty.”

Across New Zealand, median prices decreased by 13.9% year-on-year to $762,000. However, when comparing to January, the median sale price increased across most of the regions. Auckland saw a 7.0% increase, tipping back over the $1 million price point.

Median days to sell were at 60 days for February 2023 — up 18 days annually compared to February 2022 and had a small increase of 6 days from 54 when compared to January 2023.

Regional highlights

- Whilst prices continue to ease annually, most regions saw an uptick in median price month-on-month (usual for a February), with Auckland seeing a 7.0% increase tipping it over the $1m price point once again.

- Tairāwhiti, Taranaki and West Coast were the only regions that had a decrease in month-to-month median sale price of-14.8%, 9.1% 17.4% respectively.

- Tasman had the largest increase in the median sale price month-to-month, up 9.7%.

- Median sales prices in the regions for February (year-on-year) have dropped (except Marlborough).

Regional Analysis - Northland

Northland’s median price decreased by 8.3% annually to $715,000 this February.

“Owner occupiers remain the most active buyer pool and first home buyers are showing an increased interest in low-tomiddle-range properties.

“Northland’s market was significantly impacted by Cyclone Gabrielle, seeing patchy open home attendance and putting a hold on the activity we’d normally expect throughout a February month.

“Local salespeople say that this impact will be felt over the next few months as owners and buyers assess the long-term implications of flooding, storm damage, and in some locations, the impact on property values over time. The market was cautious before these weather events, and with rising interest rates on top of this, caution is expected to linger around for a while longer.” (REINZ)

The current Days to Sell of 85 days is much more than the 10-year average for February which is 62 days. There were 46 weeks of inventory in February 2023 which is 26 weeks more than the same time last year.

Regional Analysis - Auckland

The median price in the City of Sails saw an annual decrease of 15.2% in February to $1,009,000.

“Due to Cyclone Gabrielle, market activity was subdued throughout February. Open home attendance was light, and sales counts saw an annual decrease of 41.4%.

“Many buyer groups are still finding it difficult to secure finance, and rising interest rates remain a real concern. Vendors have more realistic expectations of price and Auckland agents say people are aware of the current market conditions which are seeing potential sellers pause. We can see this reflected in our February numbers with a 36.9% decrease in listings year-on-year for Auckland.” (REINZ)

The current Days to Sell of 57 days is much more than the 10-year average for February which is 43 days. There were 26 weeks of inventory in February 2023 which is 7 weeks more than the same time last year.

Regional Analysis - Waikato

Median prices in the Waikato region decreased 7.2% year-on-year to $774,500 this February.

“Throughout Hamilton, Thames and Taupo owner occupiers showed the most interest in the market. Open homes attendance was lighter than usual due to Cyclone Gabrielle and its damage to roads restricting access to many areas.

“The cost of living, rising interest rates, and repercussions of the Cyclone have impacted buyer confidence. In particular, demand for coastal properties has been low in the Coromandel region.

“In Taupo, conditional agreements and rising interest rates have impacted the sale of sections. Many buyers are unable to service building costs whilst paying high rates of existing mortgage debts.

“However, open homes have seen a reasonable amount of attendance. Taupo salespeople say there have been events in the region which have attracted prospective out of town buyers such as the Taupo Ironman.” (REINZ)

The current Days to Sell of 65 days is much more than the 10-year average for February which is 44 days. There were 32 weeks of inventory in February 2023 which is 16 weeks more than the same time last year.

Regional Analysis - Bay of Plenty

The median price in the Bay of Plenty was down 15.3% year-on-year to $821,000 in February.

In Rotorua and Tauranga, first home buyers are beginning to make a comeback. Owner occupiers looking for properties at the top end of the market are showing the most interest.

“Salespeople throughout the Bay of Plenty say that this summer has caused much heartache for many people in the North Island and has impacted the entire country to varying degrees. People are now taking a hard look at the vulnerability of their properties in the Bay of Plenty.

“In Rotorua, the number of people in emergency housing has nearly halved in the past year and there is now more activity in the social housing market. Rotorua salespeople say this is positive news for the town and will hopefully attract more buyers soon.” (REINZ)

The current Days to Sell of 71 days is much more than the 10-year average for February which is 53 days. There were 33 weeks of inventory in February 2023 which is 16 weeks more than the same time last year.

Regional Analysis - Gisborne

Gisborne’s median price decreased 19.6% annually to $575,000 in February.

“With the region being significantly impacted by Cyclone Gabrielle, market activity was light for a standard February month.

“Sales counts were down across the region by 39.1% as people adjust to the current economic conditions, the aftermath of extreme weather and retain a mindset of waiting and seeing what will happen with prices. This has also added to the length of time properties are spending on the market which are now taking an additional 7 days to sell than they were this time last year.” (REINZ)

The current Days to Sell of 53 days is more than the 10-year average for February which is 48 days. There are 15 weeks of inventory in February 2023 which is 6 weeks more than last year.

Regional Analysis - Hawke's Bay

The median price in Hawke’s Bay decreased 17.4% year-on-year to $671,000 this February.

“There has been an uptick in new enquiry and viewings from those who have lost their homes due to Cyclone Gabrielle — however, each individual circumstance is restricted by the timing of insurance pay-outs and resulting offers being made.

“Unsurprisingly, sales counts continued to ease throughout February — down 31.0% on this time last year. Buyers are still sensitive to affordability and there is continued uncertainty around where and when interest rates may peak.

“Vendors are needing to adjust their price expectations considerably to achieve a sale, and the softening of prices means some prospective sellers are opting to stay put for the time being rather than listing their property.” (REINZ)

The current Days to Sell of 68 days is much more than the 10-year average for February which is 41 days. There were 19 weeks of inventory in February 2023 which is 6 weeks more than the same time last year.

Regional Analysis - Taranaki

Median prices in Taranaki declined by 12.1% annually to $580,000 in February.

“Owner occupiers continue to be the most active buyer pool in in the region with most offers subject to the sale of another property. There’s been an increase in cash buyers which Taranaki salespeople say is encouraging.

“Buyers remain hesitant to act likely due to lingering uncertainty about where the economy is headed. Auckland buyers have been showing interest in Taranaki since January — although most are still acting with caution and taking their time to make a decision.

“Open homes have seen satisfactory attendance, particularly properties early in their marketing campaign. Local salespeople say that when the long-term interest rates start trending downwards, buyer activity should pick up again.” (REINZ)

The current Days to Sell of 59 days is much more than the 10-year average for February which is 41 days. There were 24 weeks of inventory in February 2023 which is 13 weeks more than the same time last year.

Regional Analysis - Manawatu/Whanganui

This February, Manawatu/Whanganui’s median price was down 11.6% year-on-year to $535,000.

“Owner occupiers remain active buyers, but first home buyers are struggling with rising interest rates, inflated vendor expectations, and securing finance.

“Those vendors who are not meeting the market with their price expectations are generally withdrawing their property after they realise their expectations are unachievable.

“New listings were down by 35.8% in February, but local salespeople that these new listings are attracting reasonable attendance on the first open home. Properties that have been on the market for a while are not attracting the same level of attention — depending on location and desirability.” (REINZ)

The current Days to Sell of 59 days is much more than the 10-year average for February which is 43 days. There were 26 weeks of inventory in February 2023 which is 10 weeks more than the same time last year.

Regional Analysis - Wellington

Wellington’s median price decreased 20.6% year-on-year to $790,000 in February.

“There was more buyer activity throughout the region in February — particularly from owner occupiers. Investors, on the other hand, remain sparse.

“Attendance at open homes has also picked up, and vendors are more realistic about their price expectations.

“Despite there being more interest from prospective buyers, many are still cautious about the current economic conditions and rising interest rates.” (REINZ)

The current Days to Sell of 69 days is much more than the 10-year average for February of 39 days. There were 15 weeks of inventory in February 2023 which is 2 weeks more than the same time last year.

Regional Analysis - Nelson/Marlborough

“Median prices in the Nelson and Tasman decreased 15.6% and 5.0% to $685,000 and $850,000 respectively. Marlborough’s median price saw an uptick of 4.5% to $685,000 — the only region in February to see an annual increase in median price.

“Marlborough and Nelson’s salespeople report owner occupiers as the most dominant buyer pool — and both regions are starting to see an increase in prospective buyers from outside regions — particularly Auckland.

“Most buyers are still taking their time to make a decision, and with a plethora of choice still available on the market, properties are taking longer to sell.” (REINZ)

The current Days to Sell of 65 days is much more than the 10-year average for February which is 41 days. There were 27 weeks of inventory in February 2023 which is 15 weeks more than the same time last year.

Regional Analysis - West Coast

West Coast saw its median price decrease 16.5% annually to $289,000 this February.

“The Grey District saw an uptick of 3.9% in its median price to $350,000.

“Local salespeople say there was good market activity across the board with several sales made in the Buller, Westland and Grey Districts. Whilst sales counts have decreased when compared to this time last year, activity is beginning to return to a more standard level for what we would expect at this time of year.

“Westland’s market is showing signs of a steady few months ahead.” (REINZ)

The current Days to Sell of 43 days is much less than the 10-year average for February which is 86 days. There were 39 weeks of inventory in February 2023 which is 20 weeks more than the same time last year.

Regional Analysis - Canterbury

In February, Canterbury’s median price was down by 6.9% annually to $668,000.

“Christchurch salespeople report owner occupiers as the most active, and there was some first home buyer activity. Investors are light across the region.

“Open home attendance has been steady; terrace homes and townhouses seem to be attracting the most interest recently.

“Whilst the disruptive weather events in February did not directly impact Canterbury, the connections are extensive with more buyers from the North Island showing interest in the region — similar to the earthquakes in Christchurch when locals began to look elsewhere to live. Finance remains challenging for some, and economic uncertainty is impacting business sentiment.

“For the most part, the Canterbury market is steady in comparison to other major cities in New Zealand. Local projects, agriculture, and an increase in tourism from cruise ships is injecting cash into Canterbury’s economy.” (REINZ)

The current Days to Sell of 49 days is more than the 10-year average for February which is 40 days. There were 21 weeks of inventory in February 2023 which is 10 weeks more than the same time last year.

Regional Analysis - Otago

Dunedin: This February, Dunedin’s median price decreased by 18.2% annually to $560,000.

“First and second home buyer activity is picking up, as well as out of town buyers.

“The ability to service finance remains a challenge for many buyers, and some still have a fear of overpaying which is seeing many wait out their purchasing decisions.

“There is hesitation in the market following another OCR increase in late February and further increases expected — buyers and vendors are therefore anticipating interest rates to continue to climb.” (REINZ)

Queenstown:  The median price in the Queenstown-Lakes District saw a slight decrease of 1.4% to $1,370,000.

First home buyers and buyers downsizing were the most active in the market over February, with the numbers of investors still low.

“Open homes were busy in the Queenstown-Lakes District market, and local salespeople say that market confidence is slowly on the rise, and that they are hopeful that this trend will continue in the coming months.” (REINZ)

The current Days to Sell of 60 days is much more than the 10-year average for February which is 39 days. There were 20 weeks of inventory in February 2023 which is 6 weeks more than the same time last year.

Regional Analysis - Southland

The median price in Southland decreased 9.5% annually to $430,000 in February.

“Southland salespeople reported that buyers are scarce and not showing as much interest as expected for a February month. This is largely due to economic uncertainty and rising interest rates adding to caution and a lack of confidence within buyers.

“Sales counts were down 32.7% and properties are taking an additional 15 days to sell than they were this time last year. Local salespeople expect to this be the case for much of this year.” (REINZ)

The current Days to Sell of 52 days is much more than the 10-year average for February which is 39 days. There were 21 weeks of inventory in February 2023 which is 10 weeks more than the same time last year.