Last month, independent economist Tony Alexander published a report suggesting New Zealand’s house price correction was bottoming out.
This view was based on data showing sales and prices had stopped falling.
Alexander then predicted a “5% annual gain come the end of this year then 10% next year”, driven by record immigration flows, rising rents, rising incomes, easing lending criteria, declining housing construction, and a likely change in government in October alongside the “reintroduction of tax rules encouraging provision of rental accommodation”.
Housing data appears to have deteriorated in July, with Auckland’s largest real estate agency, Barfoot & Thompson, reporting flat sales but tumbling values:
“Barfoot & Thompson sold 727 residential properties in July, little changed form the 711 it sold in June and 723 in May. However, that is up 19% from July last year”, reported Interest.co.nz.
“The big mover in July was price, with the median selling price shedding $45,000 to $950,000, after remaining unchanged at $995,000 for the previous three months”.
“That is the lowest the median price has been since September 2020, and is now down $290,000 (-23%) since it peaked in November 2021”.
“The average selling price declined by $30,826 to $1,067,070 in July, putting it at its lowest point since November 2020”.
“Barfoot’s average selling price has now declined for four consecutive months”.
Peter Thompson, Managing Director of Barfoot & Thompson, believes there will be little fluctuation in prices as the market transitions out of winter and into the election season.
