House sales drop in lockdown but demand strong, prices up in Canterbury

The national median house price rose a seasonally adjusted 25.5 percent in the past 12 months to ...
The national median house price rose a seasonally adjusted 25.5 percent in the past 12 months to $850,000. Photo: RNZ / Nate McKinnon
The latest lockdown has done little to dampen confidence in the housing market in Canterbury.

The Real Estate Institute says median house prices in Canterbury set a new record of $619,000 in August, up 24.3 per cent from $498,000 in August 2020.

Christchurch City ($650,000), Kaikoura District ($675,000), and Waimakariri District ($645,000) all reached record median prices.

"Canterbury is experiencing a low level of stock down 49.6 per cent annually. These low levels of stock have meant that competition has remained high for available properties, and these are selling quick," said REINZ chief executive Jen Baird.

"Canterbury saw the lowest median days to sell a property for an August month since 2013, at just 28 days. Before the level 4 lockdown, listings were starting to increase heading into spring, but the lockdown slowed things down and as a result, new listings are down 35.5 per cent when compared to August last year.

"Auctions have continued online throughout the lockdown and August saw Canterbury sell 28 per cent of properties by auction up from 13.8 per cent the year prior. Canterbury saw a new record on the REINZ House Price Index of 3492 up 31.2 per cent annually.

"People are remaining optimistic that if alert levels continue to ease, activity should increase and recover from the lockdown promptly. The impacts of the lockdown are expected to be felt throughout the coming weeks, easing as
more properties come to the market.”

The Real Estate Institute's house price index, which measures the changing value of property in the market, rose 31.1 percent nationally in the year ended August to 4012.

The national median house price rose a seasonally adjusted 25.5 per cent in the past 12 months to $850,000. The national median price excluding Auckland was $700,000, a 22.8 per cent increase on a year ago.

"This latest lockdown has not dampened demand for, or confidence in, the housing market as we saw in early 2020," Baird said.

The number of properties sold in August fell by 26.5 percent when compared to the same time last year, reflecting the effect of the reintroduction of lockdown restrictions.

At the same time the number of properties available for sale fell by close to a third in the past 12 months to 12,259, the lowest level of inventory ever recorded.

"We have heard from across the industry that prices achieved on sales completed in the early part of this lockdown continue to illustrate an ongoing excess of demand over supply; prices are still rising," Baird said.

However, Baird expected more properties would soon come to market.

"It is this time of year that people start to prepare their property for the usual increase in spring sales activity, and it is expected that this will be stronger this year as listing is delayed as a result of lockdown.

"We understand that vendors have been preparing their properties for market, to list once we reach a lower alert level - we expect to see the result of this in our September data," Baird said.

The median number of days to sell a property fell three days to 30 days. August saw 26 percent of all properties sold via auction, the highest percentage ever recorded.

"Conducting an auction is a great way to understand the value of a property in a fast-moving market, and even with August being in alert level 4 lockdown for half the month, auctions still made up more than a quarter of all sales," Baird said.

Properties prices hit new median highs in four of out 16 regions, including Auckland, Waikato, Manawatu-Wanganui and Canterbury.

The median house price in Auckland is $1.2 million compared with $949,500 in August 2020.

-Additional reporting RNZ

 

 

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