New Zealand is unlikely to experience an overheated
residential housing market in the near future as indications
are for a slow improvement, a BNZ-REINZ survey indicates.
BNZ chief economist Tony Alexander said the April survey of
more than 10,000 licensed real estate agents around New
Zealand had found that, in general, conditions were perceived
as strong in the marketplace.
"More and more agents perceive that the numbers going through
open homes are rising.
"But at a net 17% feeling this way, the result is down from a
net 38% in March and the lowest outcome since December."
Practically all other measures had also eased back slightly
and Mr Alexander read that as consistent with a residential
real estate market which was improving but not becoming
A net 4% of agents still perceived that it was more a buyers'
market rather than a sellers' market but, at the same time, a
net 25% perceived prices to be rising.
The survey was suggestive of a market which was not
attracting panicked buyers, he said.
Earlier this week, Real Estate Institute of New Zealand
figures showed house sales climbed 25% in March as the
property market extended its recovery from last year's lows.
The number of sales rose to 7330 in March from 5848 in the
previous corresponding period.
The national median house sale price gained 1.4% to a record
$370,000 and was up from $335,000 in February.
Dunedin sale prices climbed 13% to $232,500 in March.
However, ASB economist Jane Turner said while the institute
reported a 4.8% increase in housing turnover (seasonally
adjusted) for March, the ASB seasonally-adjusted estimates
saw house sales easing slightly, down 2.6%. That followed an
8% increase in February.
Overall, housing turnover had been steadily recovering since
the start of 2011, gaining additional momentum during summer,
Improved household confidence appeared to be underpinning the
lift in housing demand. Weak population growth and a subdued
recovery in the labour market had resulted in demand
remaining relatively subdued compared to historical levels,
Ms Turner said.
The BNZ survey backed up claims of a subdued market. A net
35% of agents noted that more written sales were going
unconditional but Mr Alexander read that as saying few buyers
were backing out of agreements.
A net 12% of agents felt auction clearance rates were rising
but that was down from a net 23% in February.
A net 15% of agents reported they were receiving more
requests for property appraisals from potential sellers. The
outcome suggested no flood of properties was likely to hit
the market any time soon, he said.
The net 35% of agents reporting they were noticing more
first-home buyers in the market was consistent with anecdotal
evidence of first-home buyers seeking property.
Mr Alexander said the poor quality or outright availability
of listings was becoming a more important factor in causing
buyers to hold back from making a purchase.
A net 19% felt prices would decline, 17.3% worried about
securing finance, 17.1% were not confident they could sell
their house and 35.6% were concerned about the poor quality
Other concerns made up 11%.
Ms Turner said low supplies of housing in Auckland and
Canterbury had resulted in tight markets there. As a result,
house prices were increasing in those areas.
"We expect some of that pressure will be alleviated once
rebuilding activity commences in Canterbury."