The annual median property price across the country has fallen for the first time in more than a decade, amid the housing market slowdown.
Affordability remains an obstacle for many people, says REINZ chief executive Jen Baird Photo: RNZ / Nate McKinnon
The Real Estate Institute's (REINZ) residential market report shows the house price index, which measures the changing value of properties, fell 2.9 percent for the year ended July, compared with a 0.7 percent increase in June.
The seasonally adjusted national median price for July fell 1.6 percent from a year ago and is down 2.8 percent from June, to sit at $810,000.
The last time the national annual median price decreased was in July 2011.
Auckland's median price fell 2.7 percent (adjusted for seasonal variations) from June and 5.4 percent from a year ago, to be at $1.1 million.
REINZ chief executive Jen Baird said while the median price showed an annual decrease, affordability remained an obstacle for many, driven by rising interest rates, inflation and tighter lending criteria.
"In more affordable regions, we have continued to see significant growth compared to larger markets such as Auckland and Wellington. Buyer demand remains intact in Canterbury, and specifically Christchurch, reflected in the region's strong performance over the past months.
"On the other hand, the Wellington market hasn't fared so well. According to local agents, the number of attendees at open homes has fallen."
National sales activity fell sharply, with the number of residential property sales down by more than a third from a year ago.
Homeowners were also taking longer sell, with the national median number of days to sell a property at 47, which was 16 more than July 2021.
Baird said it was the highest number of days to sell nationally since February 2019, excluding April and May 2020, which was affected by the Covid-19 lockdown.
Housing market in 'hibernation'
Auckland was the standout weak spot in the REINZ data, with underperformance in big cities a feature in the recent market cool down, ASB Bank senior economist Mike Jones said.
"On the activity front, the state of the market is best described as hibernation.
"A sharp increase in unsold inventory (to six-year highs according to separate realestate.co.nz data) shows it was a buyer's market, but buyers just aren't interested at the moment."
The correction in house prices remained orderly, and ASB retained its forecast for a 12 percent drop from the market peak in November, he said.
"House prices are only back to where they were in June of last year, and are still 30 percent above pre-Covid levels."
Seasonally adjusted annual median price changes for selected regions
- Auckland $1.1m down 5.4 percent
- Bay of Plenty $860,000 up 4.1 percent
- Canterbury $678,000 up 13.2 percent
- Otago $645,000 down 2.3 percent
- Waikato $788,550 up 7.9 percent
- Wellington $809,100 down 5.1 percent