Median house sale price up in June, numbers sold falls 4% from May (Update 1)

The median New Zealand house sale price rose to NZ$340,000 in June from NZ$337,500 in May and was unchanged from a year before, figures released by the Real Estate Institute of New Zealand show. However the number of sales in June fell 4% from May to 6,040. (Update 1 includes main centres, days to sell and economist comment.) "(T)he reason for this (fall in sales) is not that people are not buying properties, but rather that the properties are not coming on the market," REINZ President Mike Elford said. "As noted, last month, people are sitting tight on their properties, both because people tend not to move house in cold weather and because of their continued uncertainty around where the market is heading," Elford said.

June's turnover was up from 4,305 sales in June 2008, but below other June months back to 2001 (6,098 sales). In June 2000 there were 5,501 sales. Main centres In Auckland, the median sale price fell by NZ$15,000 from May to NZ$435,000 in June, the same median as in June 2008. There were 2,032 sales over the month, down 3.9% from May. Wellington also saw a fall in the median sale price by NZ$5,000 to NZ$375,000. Sales levels were the same as in May at 674. In Canterbury/Westland, the median sale price was NZ$295,000 in June, up from NZ$285,000 in May. There were 889 sales in the region, down from 955 in May. REINZ's median 'days to sell' number was 41 in June, similar to the 42 in May and down from 53 in June 2008. However it was still higher than June months between 2002 and 2007. "The fastest turnaround for houses in New Zealand in June was in Auckland at 33 days compared with 37 days in May; in Taranaki at 31 days compared with 46 in May and in Canterbury/Westland at 37 days compared with 43 in May. The greatest improvement in movement was in Central Otago Lakes district where the length of time to sell a home moved from 52 days in June compared with 85 days in May. Sales in Otago and Southland were slower in June: from 34 days in May to 55 days in June for Otago and 37 days to 49 days in Southland," Elford said. "The overall faster time to sell shows that the buyers are out there, and the prices being paid show the money is there, but there's still a reluctance on many people's part to put their home on the market in what they perceive as a buyer's market," he said. "Shortage of stock remains the biggest issue facing the industry at the moment." ASB economist Jane Turner pointed out that despite the housing market being considered one of the 'green shoots' of the New Zealand economy in recent months, the number of house sales remained low on a per-capita basis:

The housing market is one area of "˜green shoots' for the NZ economy, with low interest rates now stimulating interest. However, the overall recovery remains reasonably modest, on a per-capita basis the number of house sales remains low, as economic uncertainties continue to weigh on confidence. The current state of the housing market is in line with the RBNZ's expectations. More of a concern is the continued pressure on the business sector. With demand remaining weak and profitability falling, further cuts in employment and investment are likely. The RBNZ won't be comfortable until it sees these areas have stabilised. The strength in the NZ dollar continues to challenge the export sector and we see scope for further OCR cuts down the track, and have two 25 basis points penciled in for September and October.