Photo: RNZ
Rising interest rates and falling prices and sales are making the housing market more uncertain, according to the Real Estate Institute (REINZ).
The Institute's House Price Index, which measures the changing value of residential property, fell 13.7 percent in November on the year before, when the market was at its peak.
The median house price dropped $10,000 to $810,000 from October, with prices down 12.4 percent on a year ago.
Institute chief executive Jen Baird said buyers and sellers have turned hesitant as they ponder rising mortgages and falling prices.
"Buyers are again weighing up the likely impact on mortgage rates with current downward pressure on property prices. Those thinking of selling are again looking at the market and asking, 'Is this the right time?'"
Prices over the year were lower in 14 of REINZ's 16 regions, but the West Coast and Southland managed to hit record highs.
Biggest annual price falls were in Auckland at 18.1 percent, Wellington down 17.4 percent, and Hawke's Bay 17.2 percent.
Although sales rose 7.7 percent on October, they were down 36 percent on a year ago, and the stock of houses available for sale was up 47.7 percent during the 12 months to 28,449.
"With decreasing demand and more supply on the market, able buyers have the luxury of choice and time to make informed purchasing decisions," Baird said.
She said agents were report hesitancy amongst buyers, but there were signs sentiment was shifting.
"Agents around the country say sellers are realistic, they are meeting the market, they are entering negotiations."
"If you can make the finances work, this is a good time to be a buyer. Firstly, there is significantly more stock on the market. Secondly, the market is less competitive."
She said owner-occupiers remained a strong presence in the market but investors had largely stepped back.
"Affordability will remain an influencing factor, but for those previously sidelined in last year's quick-paced market now is a great time to take another look at what's out there."
Baird said interest rates were expected to peak next year before they started to fall back.