Number of houses sold drops 12.9%

The number of residential properties sold in December was the lowest for that month in seven years, figures from the Real Estate of Institute of New Zealand show.

The number of houses sold in New Zealand fell 12.9% year on year, down from 6117 to 5330.

For New Zealand, excluding Auckland, the number of properties sold dropped 8.2% compared with December 2017, from 4352 to 3994. That was the lowest for the month of December in five years.

In Auckland, the number of properties sold fell 24.3% year on year and was the lowest for the month of December in a decade.

While December was traditionally a quiet month, last month was "extremely quiet", REINZ chief executive Bindi Norwell said.

Also, 12 out of 16 regions saw an annual decrease in the number of properties sold.

Otago volumes fell 14.6%, from 391 to 334, while Southland dropped 13.4%, from 142 to 123, its lowest since April 2017.

In December the national median value rose 1.5% compared with the previous December, from $551,750 to $560,000.

Prices for New Zealand, excluding Auckland, increased 6.4% to $480,000, up from $451,000 in December 2017. In Auckland, prices rose 0.2% to $862,000, up from $860,000.

The REINZ house price index, which measures the changing value of property in the market, increased 3.3% year on year to 2740.

In December, the Manawatu-Whanganui region had the highest annual growth rate, a 17.7% increase to a new record high of 2867, followed by Gisborne-Hawke's Bay with an annual growth rate of 13.7% to a record high of 2654, and Otago with a 12.4% annual increase to a record high of 2867.

Although the sales data appeared bleak at first glance, there were factors to keep in mind, ASB economist Kim Mundy said.

Many provincial markets remained tight, limiting December sales volumes, while housing data was notoriously difficult to get a good steer on over the Christmas period.

Some potential buyers might have put off purchases until loan-to-value ratio restrictions were eased on January 1, she said.

The data highlighted a "continuing dichotomy" in New Zealand's housing market. While the Auckland market remained lacklustre, house price growth in regional New Zealand was continuing at a reasonable pace, she said.

Westpac chief economist Dominick Stephens said the impact of the foreign buyer ban had "really shone through" in the data.

Housing market turnover shot higher in October, just before the ban came into force, but had subsequently tanked.

The big drop in sales was in Auckland and, to a lesser extent, Wellington and Christchurch. That matched where foreign buyers were most active.

Queenstown Lakes had a high proportion of foreign buyers but they were often Australians, who were exempt from the ban.

It was not clear yet whether the foreign buyer ban would have a bigger impact than the drop in mortgage rates and LVR loosening.

But it was clear disparities between regions in terms of house price inflation would remain, Mr Stephens said.


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