There was a sharp drop in residential real estate activity in August with many potential vendors holding off listing their properties for sale with the Covid-19 Level 4 lockdown in place.
Property website Realestate.co.nz received 6504 new residential listings in August, down 17% compared to July.
That's the lowest number of new listings in any month since April last year when the country was also in a Level 4 lockdown.
That puts market activity in August on a par with December, which is traditionally the quietest month of the year as the market winds down for the Christmas/New Year break.
The downturn in new listings was evident in all of the major centres, while a few provincial districts where holiday homes are a feature of the market were unaffected. Northland, Coromandel, Gisborne, Marlborough and Central Otago-Lakes posted small gains in the number of new listings in August compared to July.
However the drop in new listings doesn't appear to have affected the total volume of property on the market.
At the end of August Realestate.co.nz had a total of 12,249 residential properties available for sale on its website, only slightly down from the 12,684 it had available for sale at the end of July.
That suggests either there was a high number of new listings in the first half of August before lockdown commenced, and/or the number of sales dropped away along with new listings in the second half of the month as lockdown restrictions kicked in.
Because of the severe restrictions a Level 4 lockdown places on real estate activity, it's difficult to draw too many conclusions about the state of the market from the latest figures.
Last year market activity bounced back very quickly as lockdown restrictions were eased and this year that's likely to correspond with the usual spring uplift in sales activity.
However the residential property landscape is different this year, with LVR restrictions on new mortgage lending back in place, new tax rules for investors and the likelihood of rising mortgage interest rates.
Auckland, which is the main driver of real estate activity, is also likely to take longer to recover because it's remaining in lockdown for longer than the rest of New Zealand.
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1 Comments
Its hard to photograph, do final prep etc when you cant buy paint or have trades visit to prepare for listing/run open homes etc. Add in RE is a good inflation hedge and the Govt seems hell bent on protecting printed debt leverage, it makes sense not to list.
What would you do with the cash - put it in the bank to see its value destroyed?
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