The housing market stand-off
Buyers have more time and choice, while vendors are not budging on price, leading to a stand-off of who is going to blink first.
New Zealand's property market is at an impasse, with buyers taking their time making purchases and vendors hesitant to adjust prices, according to the Real Estate Institute. July data reveals prices remained stable, with the national median dropping 0.7% compared to the previous year. The house price index, which accounts for fluctuations, fell 0.4%.
Despite this, sales numbers dropped by 10% to 6,090. Auckland's turnover saw an 8.9% decrease. The institute reported it was the fifth-slowest July on record. Infometrics economist Brad Olsen noted the drop in sales was significant, stating that while the market isn't crumbling, it's not thriving either. House sales have been declining for five months, while prices have either remained stagnant or slightly decreased.
Some believe the housing market is more balanced, but Olsen doubts this assessment. Sellers may be expecting higher prices, while buyers are cautious, leading to a standoff. Factors like the official cash rate increase, cost of living pressures, global uncertainty, and an upcoming election may be contributing to the market's stagnation.
Prices are still down 17% from their peak, with Auckland and Wellington experiencing the most significant declines. The market's uncertainty varies regionally, with some areas showing positive trends.
Written by urgent.news from RNZ Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
