This year is likely to remain a sellers' market for real
estate, according to realestate.co.nz figures released
yesterday. The new year has started with even fewer properties
for sale, but with an easing in asking prices.
Market sentiment now favoured sellers in 14 regions,
realestate.co.nz figures showed.
The Reserve Bank faced a dilemma of balancing a
supply-constrained housing market fuelling a lift in credit
growth against a muted economic recovery, ASB economist Jane
Turner said. Commenting yesterday on the latest listings
provided by realestate.co.nz, Ms Turner said the December and
January figures were interpreted with greater caution than
usual, given the limitations of seasonally adjusted monthly
data over a small sample.
''Nonetheless, the results suggest the housing market has
potentially tightened up further in December, with supply
failing to respond to the increase in demand in 2012.''
Ongoing tightness in the housing market would continue to
place upward pressure on house prices, she said.
Fewer properties are on the market as the new year starts.
Photo by Gerard O'Brien.
Housing market activity was often disrupted over the
Christmas break, and caution was needed in interpreting monthly
seasonally adjusted estimates over this period, particularly
given the relatively short history of the data set, Ms Turner
New listings fell a seasonally adjusted 8.4% in December, led
by a 22% decline in Auckland listings. In Otago, new listings
in December were up 14.7% at 290, up 72.5% in Southland at
314 and up 12.6% in Central Otago-Lakes at 331. Canterbury
listings were down 4% at 962 and the West Coast was down
35.1% at 63.
Auckland, Waikato and Otago were most affected by low
inventory levels, stocks of unsold homes falling to record
lows of 13.9 weeks of inventory in Auckland, 31.5 weeks in
Waikato and 20.4 weeks in Otago, each well below their
long-term inventory levels.
Inventory levels across the country remained low and the
market remained a ''firm sellers' market'' across 16 of New
Zealand's 19 regions, realestate.co.nz said on its website.
Total houses available for sale fell 4.6% in December, led by
a 13% decline in Auckland inventory. The stock of houses
available for sale in Auckland has fallen to just 14 weeks of
sales - the lowest recorded by realestate.co.nz, although
records only go back to 2007.
The Otago asking price held its own compared with most of the
other centres. The Otago asking price in December was
$277,733, down only 0.4%, compared with Canterbury's, which
fell 4.1% in the month to $389,273 and Central Otago-Lakes,
where it fell 12.8% to $515,869. A record high asking price
was seen in Southland, where it rose 3.6% to $264,028.
In light of the weaker economic growth figures, ASB
economists now expected the Reserve Bank to keep the official
cash rate on hold until December 2013. The bank had
previously forecast the first rise in September, Ms Turner
said. ''However, we believe the central bank will not be able
to tolerate the momentum in house prices and credit growth
for much longer, as it poses a risk to both monetary and
financial stability objectives.''
There was a growing possibility the Reserve Bank would opt to
use macro-prudential tools at some point in 2013 in order to
ease pressure in the housing market, Ms Turner said.