Property listings hit record low

New figures released today show a surprising slowdown in New Zealand's property market with the number of newly listed properties in December hitting a record low.

Some regions, however, are bucking that tend with a surge in listings and even record prices.

A spokesperson for realestate.co.nz, Vanessa Williams, said last year's election brought a brief "sugar rush" with large numbers of vendors putting properties up for sale.

"I think a lot of Kiwis were hoping for a change, to shift the impact of the economic environment, and we did start to see a rush happen in November when over 10,000 new listings came onto the market," she said.

"However, that rush has certainly dipped coming into the festive season with less than 5000 new listings in December."

That was 6.4 percent lower than the corresponding figure in December 2022 - and the lowest monthly figure since realestate.co.nz records started 16 years ago, with the exception of the Covid lockdown period.

While new listings always slowed as Kiwis headed to the beach for a summer break, last month's decline was more dramatic than usual.

Williams put that down to a combination of still-high interest rates, cost-of-living pressures, and vendors waiting to see what the new government brought in 2024.

However, the regions were bucking that trend - especially in popular holiday spots.

Vendors make most of summer visitors

The Coromandel led the pack with a 22 percent surge in new listings in December, compared to the same period in 2022.

Marlborough, Northland and the central North Island were also well up on the same time last year, by 14.5, 11, and 10.6 percent, respectively.

Wellington (11.5 percent) was the only metropolitan area where listings increased.

"In the summer months typically our summer hotspots do better than our major centres. If you look at the likes of Northland, we've seen both an increase in year-on-year new listings coming to market, but also the total pool of houses available for buyers to peruse," Williams said.

"It's the same with Coromandel and the likes of Marlborough. That is typically because they are summer hotspots that people like to peruse, and they do see an influx of visitors - so perhaps vendors are capitalising on that increase in visitors coming to their region."

Nationally, the average asking price of a property in December fell almost 4 percent relative to a year earlier.

The biggest drops were in Southland (11.3 percent), central North Island (9.8 percent) and Waikato (9.8 percent).

Despite the surge in listings, the average Coromandel property price dropped by 8.7 percent year-on-year - but even so it remained at just over $1 million, putting the peninsula on a par with Auckland.

The biggest jump was in the Central Otago Lakes District, which includes boom town Queenstown.

There the average property price shot up 16.2 percent to $1.6 million, an all-time record for any area of New Zealand.

"The two regions that have really surprised me in the past 12 months have been Coromandel and Central Otago Lakes," Williams said.

"While the rest of New Zealand was either dropping or staying remarkably flat, those two regions continued to see growth. Meanwhile, our biggest centre, Auckland, peaked at about $1.25 million, but has now dropped back by about $200,000."

Repercussions for Queenstown residents

Williams thought an increase in overseas interest could be driving Queenstown's property price boom.

Those skyrocketing house prices, however, create problems for people who live and work in the resort town, and for businesses that need to employ people who can't afford multi-million-dollar homes.

Julie Scott, of the Queenstown Lakes Community Housing Trust, said the town already had a dire accommodation shortage.

"It certainly makes it extraordinarily difficult for low to moderate income workers. We have over 1160 eligible households on our waiting list," Scott said.

"The average household income before tax is around $70,000, $75,000, and there's a lot of households that earn a lot less than that. All those people on that waiting list have zero chance of getting into the market on their own."

Scott said it wasn't just hotel and tourism workers that were affected.

"We're also talking about teachers, nurses, police, all those key workers any community needs to keep ticking over. We struggle in this district to attract and retain key workers because of the housing affordability issue."

Scott said there was no silver bullet for the town's housing crisis, but the community housing trust - established by the council and part-funded by central government - was "a great step".

The trust offered public housing and below-market rentals, as well as rent-to-buy and assisted ownership programmes.

"The key thing is to have a variety of housing programmes to assist people to move towards independence.

"One of the things we really need is more housing supply, and there's a number of reasons why there's a huge lack of that in this district, in Queenstown particularly. They include geography and the fact we just don't have the infrastructure to allow more housing to be built."

Opening of SH25 pivotal

Meanwhile, Coromandel Mayor Len Salt put his district's real estate revival down to last month's reopening of the crucial State Highway 25.

"That came at the end of a really tough year when people had trouble getting access to parts of the Coromandel. Business was slow because tourism numbers were down and we were dealing with a lot of road closures.

"On December 20 we saw a complete reversal of that and a lifting of the mood and morale of people, so potentially there would've been a lot of people holding off listing their properties until they knew that access was reinstated. And then they decided, 'Okay, now the road's open, let's put the place on the market'."

However, just like in Queenstown, a buoyant real estate market was a double-edged sword - especially in a district with a mix of high- and low-income residents.

"For every upside there's a downside in terms of people being able to get into their first home and access to affordable housing. That's something our council has been focusing on quite strongly because we have a housing shortage," Salt said.

"We have an inability for people to get into safe, warm, dry housing, and as these prices go up, and the market lifts, then it makes those challenges even more severe."