The March 2011 NZ Property Report published by Realestate.co.nz provides an insight into the state of the New Zealand property market as measured by the supply side of the property market over the month of February. The key measures of the market analysed in the report are the number of new listings, the asking price expectation for those new listings and the level of inventory of unsold houses on the market at this time. The report is compiled from data captured by the website and represents close to 95% of all property movements in the NZ market as managed by licensed real estate agents.
A full print version of the NZ Property Report – March 2011 is published below and is available for download (1.3MB) and distribution.
Summary of the market – March 2011
Any analysis of the NZ property market for March would be incomplete without reference to the impact of the Christchurch earthquake. The Canterbury region is the second biggest property region representing around 15% of the market. In March the level of new listings in the region fell 36% compared to a year ago, whilst the country excluding Canterbury fell only 11%. Based on a representation of the national total it is likely that around 480 less properties were listed in the Canterbury region in the month than would have been anticipated at this time of year.
Nationally the rise in asking price was the most significant single piece of data from the overall report. The asking price nationally is now hovering close to all time highs and is particularly strong in the major cities. Auckland at $551,720 is up 1% as compared to prior month and prior year; with Wellington at $453,021 up 2.5% on last year and 1% from last month. Canterbury at this time shows no significant change in price in line with recent 3 month average.
The level of inventory of unsold homes on the market continues to grow, recording its 3rd consecutive month of rise to break through the psychological level of one year, reaching 53 weeks. Given this high level of inventory, matched to slow levels of new listings it is becoming clear that the high asking price is more likely to be the result of keen interest focused purely on new listings; leaving older listings somewhat “languishing on the shelf” at what could be unrealistic prices or presentation that needs refreshing to attract buyers.
The truncated mean asking price for all new listings in March rose again to $421,940 up from $420,265 in February. On a seasonally adjusted basis the asking price rose 1% indicating a continued confidence amongst sellers.
The trend of the past 2 years shows continued strength in asking price expectation.
The level of new listings whilst rising in March was still 15% down compared to March last year. The current 12 month moving average total shows 131,722 new listings down 6% as compared to the prior 12 month period. The market continues to remain quiet in terms of listings and sales as has been seen in the REINZ sales reports for the last few months with both January and February reporting record lows. February sales totaled 4,502.
The level of unsold houses on the market at the end of March actually fell from 52,672 in February to 51,980 in March. This represented the equivalent of 53.1 weeks of equivalent sales, as assessed on a seasonally adjusted basis.
The key driver of this rising inventory is more a reflection of somewhat lackluster sales than excessive new listings. The absolute level though at over a year of equivalent sales will continue to impact the market and maintain the “buyers-market” perspective.
Regional Summary – Asking price expectations
With a strong national asking price growth of 1.9% as compared to the recent 3 month average, the expectation would be to see a consistent trend across the country. The fact is that 11 regions of the 19 did post rises in asking price, however there were some significant falls. The majority of the falls were in provincial regions.
Both Wellington and Auckland saw asking price rise close to peak, with Wellington particularly strong with a 4.1% increase to come within $2,500 of the peak asking price indicating confidence in vendor expectations.
By contrast the situation in Northland and Marlborough, which both showed significant falls in asking prices taking those regions to record low asking price levels.
Regional Summary – Listings
Four regions posted an increase in new listings with Waikato the standout showing a 9% increase to 994 new listings, the highest level in over 3 years.
As previously noted the Canterbury region saw a 36% fall. Over the past 7 months since September a total of 8,558 new listings have been brought to the market across the region. This is down 30% from the 12,232 recorded in the same period in the prior year.
Wellington regions showed a strong performance with a 6% increase. This region has been active with increases consistently over recent months taking the 12 month average up 6% on the prior year.
Regional Summary – Inventory
A consistent picture of high inventory of unsold house on the market pervades the region map. There are pockets where levels are moderate, particularly in Bay of Plenty and Central North Island, however the remainder sit well above long term average.
Of the 19 regions a full 8 of them are now sitting at record high levels of inventory – Central Otago, Hawkes Bay, Manawatu / Wanganui, Nelson, Northland, Otago, Taranaki and the Wiakato.
In total provincial NZ which comprises all of the regions excluding the main centres of Auckland, Wellington and Canterbury reached a record peak of inventory of 76.7 weeks which compares with 36.6 weeks in the metropolitan areas.
These record highs as noted earlier are as much a factor of slows sales, are clearly offering a broad range of options to buyers active in the market.
Lifestyle property performed fairly strongly in respect of new listings with a total of 1,096 coming onto the market in March up 17% from February and in line with March last year. The asking price expectation fell by 2% in the month from $552,591 to $542,975 which was down 8% as compared to March 2010.
Despite the overall levels in Canterbury lifestyle listings remained steady with 130 new listings as compared to 144 in March 2010, the reality would be that almost all of the lifestyle properties in the region would be well outside of the immediate vicinity of Christchurch city.
Apartment listings grew in March but at 516 failed to reach the level of 613 seen a year ago. Based on a 12 month moving average volumes of apartment listings continue to fall with 6,216 in the most recent year down 9%. In Auckland the trend is down with 5% decline on a 12 month moving average basis. March saw 332 new apartment listings in Auckland down 8% from a year earlier.
The asking price expectation rose 4% in March from $365,150 to $378,494. This level though is down 3% as compared to a year ago and down 4% as compared to the recent 3 month average. Auckland apartment listings reflected a similar trend down 4% year-on-year.
Property Price Index
Comparing the sale price of properties across the country to the asking price expectation is not a perfect comparison; however the trends tend to align. The benefit is that the data for asking price is of the market today, whilst the selling price is reflective of the market active between 4 and 6 weeks ago. The latest comparison is highlighted below:
Realestate.co.nz data is compiled from asking prices of new residential listings as they come onto the market via subscribers to the realestate.co.nz website. The Realestate.co.nz website currently has over 95% of all licensed real estate offices subscribing and providing all of their listings onto the website. The asking price is presented as a truncated mean price at a 10% interval.
REINZ: data is compiled from reported unconditional residential sales from all members of the Real Estate Institute of New Zealand representing all licensed real estate offices. The sale price is published as a stratified median house price and is developed in association with the Reserve Bank of NZ.
The monthly asking price for new listings presented in this report utilises the measure of ‘truncated mean’. This measure is judged to be a more accurate measure of the market price than average price as it statistically removes the extremes that exist within any property market that can so easily introduce a skew to traditional average price figures.
The truncated mean used in this report removes the upper 10% and the lower 10% of listings in each data set. An average or mean of the balance of listings is then calculated.
With the largest database of properties for sale in NZ, realestate.co.nz is uniquely placed to immediately identify any changes in the marketplace. The realestate.co.nz NZ Property Report is compiled from new listings coming onto the market from the more than 1,020 licensed real estate offices across NZ, representing more than 95% of all offices.
With an average monthly level of over 10,000 new listings, the realestate.co.nz NZ Property Report provides the largest monthly sample report on the residential property market, as well as a more timely view of the property market than any other property report. The data is collated and analysed at the close of each month, and the Report is compiled for the 1st day of the following month. This provides a feedback mechanism as to the immediate state of the market, well in advance of sales statistics which by the very nature of the selling process can reflect activity with a lag of between 2 and 4 months.
In analysing the details of the 12,247 new listings in the month of January a total of 156 listings have been excluded due to anomalies. The categorisation of Lifestyle property is defined by the land area of the property. The criterion is a property having in excess of 0.3 hectares and being situated outside metropolitan areas.
Background to Realestate.co.nz
Realestate.co.nz is the official website company of the real estate industry of New Zealand, it is an industry owned web business providing online marketing services to the real estate industry. The shareholders in the business comprise the REINZ (50%) and six of the largest real estate companies (50%).
The business operates a portfolio of websites all focused to specialist sectors of the real estate market:
Realestate.co.nz is the heart of the business and is focused to the residential property market. It features the most comprehensive selection of property for sale and rent across NZ. The website attracts a significant monthly audience of over 400,000 unique browsers, with over 110,000 of those visiting from countries outside of NZ.
nzFarms is a specialist website presenting the most comprehensive selection of farms and agricultural businesses on the market across NZ. At this time it features around 5,000 listings for all types of farms and agricultural land as well as over 11,000 lifestyle properties.
Prime Commercial is a specialist website presenting the most comprehensive selection of commercial property for purchase or lease on the market across NZ. At this time it features over 27,000 listings for all types of properties – retail, commercial, industrial and investment properties.
Prime Business is a specialist website presenting the most comprehensive selection of businesses for sale on the market across NZ. At this time it features over 4,300 listings for all types of businesses – retail, tourism, wholesale as well as franchise opportunities.
Zoodle is a specialist property information website providing very detailed data on all residential properties in NZ. The database comprises over 1.6m properties with detailed specifications, map and local amenities. The site provides online reports for free and for purchase covering valuation and legal information to greatly assist the needs of property buyers and sellers.
The web business of Realestate.co.nz site is the most comprehensive real estate web operation in NZ, currently hosting over 120,000 listings, covering this portfolio of residential property for sale and rent, commercial property for sale and lease, rural properties and farms, as well as businesses for sale. With a subscriber base of over 1,020 offices, the company represents over 95% of all listings from licensed real estate agents in NZ.
The full NZ Property Report for March 2011 can be downloaded here (1.3MB pdf document). Additionally the raw data is accessible here as an Excel spreadsheet enabling anyone to analyse the raw data and establish any trends or observations.
Usage rights are governed under attribution to the source of the data being Realestate.co.nz. The next NZ Property Report for April 2011 will be published on this website on Sunday 1st May 2011 at 10am.