The number of new property listings has dropped amid the cooling of the housing market, and the official cash rate (OCR) rising for the ninth time in a row.
New data released by realestate.co.nz showed that the number of new listings has dropped by 26% in November 2022 compared to November 2021.
Realestate.co.nz told spokesperson Vanessa Williams said that New Zealand has generally seen more houses in the market, but changes in the OCR have contributed to this month's drop.
“Rising interest rates mean less credit is available for Kiwis looking to buy. As a result, we have seen house prices trend downwards, likely impacting those looking to sell.”
It comes after a massive spike in housing stock - it was up in July and August year-on-year 107.8% and 107.7%, respectively.
In November, it up 47.7% year-on-year.
Williams suggested that the drop could be a sign that the housing market is on the other side of a stock peak.
“I think we are still a way out from seeing stock levels decline, but if stock growth begins to decelerate, it will likely have a wider impact on the market. It comes down to supply and demand,” Williams said.
While the average number of properties on the market is down, some regions are still seeing their stock double or close to doubling.
The largest stock increases were in Coromandel (up 149.9%), Nelson & Bays (up 125.1%), Central North Island (up 98.5%), and Taranaki (up 92.4%).
Sales taking longer
Homes also seem to be selling at a much slower pace. Realestate.co.nz’s Sarah Wood said the average time is around seven weeks.
She told Breakfast that this increase in time is due to a change in the mindset of buyers, who are able to take more time due to the overall increase in stock this year.
“There are people coming to market. I just think that they’re surveying their options - when the market dynamics change, it gives them more time to consider their options and do their research,” she said.
Along with the number of houses going up for sale, the average asking price has also dropped.
For the first time since mid-2021, the average asking price fell below $900,000, with predictions it could sit around $890,000 by the end of the year.
“There is a realism around meeting the market; vendors that are well marketed, well presented and are well priced are moving through the market,” Wood said.
Despite the overall drop, four regions have seen their average asking price increase in October 2022. Bay of Plenty was up 1.1% to $991,556, Nelson and Bays jumped 4.1% to $915,310, Southland increased 2.5% to $531,555, and Coromandel bumped up by 6.2% to $1,155,155.
Wood said that buyers should focus on finding a home that suits them and their family best instead of buying for the market.
She said that if vendors market their properties well, then there should be no trouble selling them.
“Make sure that it’s presented well and that you’re realistic around where the demand in the market is at,” she said.
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