Cautious confidence has returned to the New Zealand property market as the number of sales increases with a decline in the national median price and a slowdown in new listings.
According to the Real Estate Institute of New Zealand (REINZ) report, the median price saw a year-on-year decline of 0.9%, settling at NZ$763,000.
"The increase in the median days to sell reflects a market that, while more active in terms of transactions, is also characterised by greater buyer caution,” the RENIZ report said.
"Purchasers are taking longer to commit, which local agents suggest could be due to a lack of buyer urgency and the fact that buyers have time to find a property that best suits them.”
This was driven by a year-on-year decline of 3.5% in Auckland, reaching a median price of $975,000. Excluding Auckland, the median price remained stable at $689,000.
Half of the 16 regions reported an increase in median prices compared to May last year, with Southland having a notable 10% increase to $495,000. Despite the noticeable increase, Southland was still popular with first-home buyers.
“First home buyers were the most active buyer group in Southland, due to the affordability of properties and finance availability,” the report said.
The greatest decline was seen in Manawatu-Whanganui, where the median price dropped from $560,000 to $530,000.
Stable interest rates with the country's official cash rate continuously moving into its desired 1% to 3% target range have encouraged more buyers to enter the market. However, this level of confidence varies by region.
Across New Zealand, properties sold rose by 8.9% in May compared to the same time last year. Northland reported the highest year-on-year increase of 33.3%.
There was also a 6.4% increase in properties sold across the nation from April to May.
While the nation experienced a 2.9% increase in listings compared to last year, when excluding Auckland, there was a 0.9% decline.
Auctions represented 12.2% of all sales and the amount of days to sell properties rose by three to 47.
The Housing Price Index (HPI) saw a year-on-year increase of 0.1% compared to a decrease of 0.6% in April this year. Over the past five years New Zealand’s HPI has been 4.2%.
