Housing values inched higher at the start of 2024, according to the latest quarterly figures from property data company CoreLogic.
The average value of New Zealand homes was $934,806 in the first quarter (Q1) of this year, up 1.1% compared to the fourth quarter last year, and up just 0.1% compared to Q1 last year.
"New Zealand's housing market can probably be described as not too hot, not too cold," CoreLogic Chief Economist Kelvin Davidson said.
"High mortgage rates remain a big challenge at the forefront of all borrowers' minds, whether they are taking out a new loan or repricing an existing mortgage."
"While the new tax year and 80% mortgage interest deductions will help cash flow for property investors, it's unlikely to be enough to trump high interest rates," Davidson said.
"In addition, while the first Official Cash Rate cut in the next cycle is getting closer, it's certainly not here yet. Indeed, if the Reserve Bank's current projections prove to be correct, the cash rate may not start to fall until next year, highlighting that shorter-term fixed mortgage rates may not drop much for at least another six-to-nine months."
A strong supply of new listings had also affected the market, Davidson said.
"We've seen a turnaround for listing activity in the first few months of 2024, with a good flow of fresh properties hitting the market, raising the choice for buyers and taking a bit of heat out of property prices," he said.
"There's no set definition, but the general sense is that the so-called sellers' market of late 2023 has now switched back in favour of credit-approved purchasers," said Davidson.
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| CoreLogic NZ House Price Index | |||
| Three Months Ended March 2024 | |||
| Territorial authority | Average current value | 12 month change % | 3 month change % |
| Far North | $719,493 | 3.5% | 3.7% |
| Whangarei | $746,176 | -1.9% | 0.8% |
| Kaipara | $852,342 | 9.0% | 0.8% |
| Auckland - Rodney | $1,276,563 | -0.4% | 2.3% |
| Rodney - Hibiscus Coast | $1,182,680 | -0.3% | 0.8% |
| Rodney - North | $1,349,603 | -1.0% | 3.1% |
| Auckland - North Shore | $1,496,433 | 1.8% | 1.4% |
| North Shore - Coastal | $1,708,604 | 1.1% | 2.5% |
| North Shore - North Harbour | $1,475,531 | 5.6% | 1.1% |
| North Shore - Onewa | $1,187,975 | 0.1% | -0.3% |
| Auckland - Waitakere | $1,011,400 | -2.4% | 0.2% |
| Auckland - City | $1,487,146 | -4.4% | 1.2% |
| Auckland City - Central | $1,274,550 | -3.8% | 1.5% |
| Auckland City - Islands | $1,562,236 | -5.7% | -1.9% |
| Auckland City - South | $1,338,246 | -6.3% | 1.3% |
| Auckland_City - East | $1,849,073 | -3.4% | 1.2% |
| Auckland - Manukau | $1,170,036 | 1.0% | 0.9% |
| Manukau - Central | $903,266 | 1.3% | 2.5% |
| Manukau - East | $1,470,856 | 2.0% | -0.3% |
| Manukau - North West | $1,017,576 | 0.6% | 2.3% |
| Auckland - Papakura | $928,820 | 0.7% | -0.1% |
| Auckland - Franklin | $915,624 | -1.5% | 1.9% |
| Thames Coromandel | $1,154,130 | -1.2% | -0.4% |
| Hauraki | $639,739 | -3.3% | -0.1% |
| Waikato | $769,335 | 1.7% | 4.6% |
| Matamata Piako | $698,943 | -0.5% | -0.3% |
| Hamilton | $807,251 | -1.2% | 0.1% |
| Hamilton - Central & North West | $752,249 | -2.7% | -0.7% |
| Hamilton - North East | $986,038 | -1.8% | -0.7% |
| Hamilton - South East | $756,018 | 0.8% | 1.6% |
| Hamilton - South West | $714,609 | -1.5% | 0.4% |
| Waipa | $873,879 | 1.9% | -0.5% |
| Otorohanga | $522,350 | -2.3% | -3.2% |
| South Waikato | $429,579 | -6.7% | 2.2% |
| Waitomo | $354,609 | -9.4% | -2.7% |
| Taupo | $847,250 | 0.6% | 2.0% |
| Western BOP | $1,008,812 | 0.4% | 0.8% |
| Tauranga | $1,037,583 | -2.1% | 0.5% |
| Rotorua | $646,275 | -0.1% | -2.8% |
| Whakatane | $726,838 | -2.6% | -1.4% |
| Kawerau | $379,227 | -4.5% | 4.5% |
| Opotiki | $551,460 | 0.4% | 9.7% |
| Gisborne | $601,545 | -1.9% | 1.6% |
| Wairoa | $410,427 | 1.3% | 1.2% |
| Hastings | $798,812 | 2.9% | -0.4% |
| Napier | $765,665 | 1.2% | 2.7% |
| Central Hawkes Bay | $605,499 | 3.6% | 4.6% |
| New Plymouth | $725,957 | 1.6% | 2.1% |
| Stratford | $504,236 | 3.9% | 1.9% |
| South Taranaki | $453,698 | 2.7% | 5.4% |
| Ruapehu | $356,511 | -6.8% | -1.4% |
| Whanganui | $508,965 | 1.0% | 0.4% |
| Rangitikei | $429,212 | 1.7% | 0.6% |
| Manawatu | $612,213 | 2.0% | 0.4% |
| Palmerston North | $651,828 | -0.6% | 1.2% |
| Tararua | $414,590 | 1.2% | 2.2% |
| Horowhenua | $566,373 | -2.7% | -0.9% |
| Kapiti Coast | $829,159 | -0.5% | 3.2% |
| Porirua | $826,884 | 1.9% | -2.2% |
| Upper Hutt | $769,420 | 4.6% | 3.5% |
| Lower Hutt | $795,390 | 1.7% | 0.8% |
| Wellington City | $1,047,275 | 2.2% | 2.5% |
| Wellington - Central & South | $1,002,197 | 4.0% | 2.5% |
| Wellington - East | $1,148,207 | -0.7% | 1.3% |
| Wellington - North | $996,629 | 1.9% | 3.1% |
| Wellington - West | $1,171,959 | 5.1% | 1.1% |
| Masterton | $563,537 | -3.3% | 0.1% |
| Carterton | $638,227 | 0.8% | 2.5% |
| South Wairarapa | $760,765 | -8.1% | 3.7% |
| Tasman | $798,992 | -1.6% | 2.8% |
| Nelson | $787,234 | -2.7% | 0.9% |
| Marlborough | $700,307 | 0.1% | 0.2% |
| Kaikoura | $720,116 | 19.0% | 11.8% |
| Buller | $358,307 | 5.4% | 6.9% |
| Grey | $412,105 | 17.3% | 10.3% |
| Westland | $424,943 | 2.9% | 5.5% |
| Hurunui | $628,740 | 1.0% | -0.5% |
| Waimakariri | $710,608 | 1.7% | 0.9% |
| Christchurch | $762,456 | 3.6% | 1.0% |
| Christchurch - Banks Peninsula | $821,514 | 2.1% | -4.3% |
| Christchurch - Central & North | $872,375 | 4.3% | 1.9% |
| Christchurch - East | $592,442 | 1.9% | 0.4% |
| Christchurch - Hills | $1,066,521 | 4.3% | 0.0% |
| Christchurch - Southwest | $725,364 | 4.4% | 1.2% |
| Selwyn | $836,921 | 2.5% | 0.9% |
| Ashburton | $535,133 | 0.8% | 0.4% |
| Timaru | $523,213 | 1.0% | 0.0% |
| MacKenzie | $747,429 | 2.4% | -1.1% |
| Waimate | $437,838 | 0.8% | 3.2% |
| Waitaki | $482,864 | -1.7% | 2.3% |
| Central Otago | $827,015 | 4.9% | 3.7% |
| Queenstown Lakes | $1,775,896 | 4.5% | 0.4% |
| Dunedin | $640,388 | 3.1% | 1.6% |
| Dunedin - Central & North | $653,314 | 3.0% | 3.2% |
| Dunedin - Peninsular & Coastal | $602,306 | 2.5% | -1.2% |
| Dunedin - South | $604,557 | 3.0% | 2.1% |
| Dunedin - Taieri | $673,928 | 3.5% | 0.2% |
| Clutha | $395,138 | -2.9% | 1.0% |
| Southland | $507,123 | 6.2% | 2.5% |
| Gore | $410,330 | 5.9% | -1.3% |
| Invercargill | $472,253 | 4.4% | 2.6% |
| Auckland Region | $1,297,595 | -1.8% | 1.1% |
| Wellington Region | $923,033 | 2.2% | 1.6% |
| Main Urban Areas | $1,032,712 | -0.3% | 1.1% |
| All of Aotearoa | $934,806 | 0.1% | 1.1% |
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56 Comments
Inflation is dropping across the globe. Swiss national bank cut in march and is the first CB to move. Rate hikes are off, sorry Shazza from ANZ
https://www.nzherald.co.nz/business/market-watch-the-surprising-stat-th…
US economy still "flying high"
NZD to become New New Zealand Peso if we drop rates before the fed.
We've been lower before, Rbnz governors trigger finger is twitchy
US economy still "flying high"
Do you expect that to change and if not why not
The only way I see it changing this year is Commercial RE imploding bigly
Prices have already changed. What could change is if there is another bank run, this time on those who may have issues due to exposure.....
Go back 20 plus yrs and the the term NZ pesos was coined by old Paul Holmes. Then shortly after the Dairy property boom kicked in. So like all things it goes in cycles
I don’t get it! There is a huge acknowledged overhang of unsold properties on the market, being worsened by high numbers of new listings and low sales numbers, agents admitting the market is soft, 70%+ of auctions not getting a sale, mortgagee sales starting to go through at >30% below 2021 RV - and yet - prices continue to edge up. Why? With more mortgage pain and brightline listings to come.. How? Sensible suggestions only please…!
We have found a house we like ... worst house in best street example. There are probably other buyers like us who have been been looking and searching. Vendors aren't desperate to sell but with extra stock available its been good
There is a wave of latent demand IMO
"Vendors aren't desperate to sell"
I suspect that is the part that will change as the year goes on
Why, what will change later in the year
Unemployment is going to tick up quickly, and the average effective mortgage rate will continue to track up from it's current 5.something% towards 6-7%.
Mortgage rates are at the top now, they will go down next year. Unemployment has to go up, we are importing it at a furious rate (immigration). They will simply sit on our generous benefits so government's share of the economy will continue to grow, albeit more slowly.
Banks are extremely cautious when unemployment is rising.
Thus getting finance is likely to be a big issue for many FHBs and those with lower equity and/or incomes, or seeking larger mortgages.
And those trading up might also face a struggle getting finance, or bridging finance, as their existing house may a) sell for less than they hoped - and increasing the amounts borrowed, or b) takes ages and ages to sell - and some may become 'accidental LLs'.
Oh I thought that the higher unemployment is a good thing, every cloud has a silver lining?
I would think so too, but then, honestly, we've all been saying that for over a year now.
…and a much bigger wave of latent supply!
How does that explain Gbogo's question about why prices are still rising?
is it the way they do the stats?
Auckland - City $1,487,146 12 months (-4.4%) 3 month (1.2%)
The average across NZ is an average of different sized citys IE add up all the average per city and have an NZ number, but if AKL was down 5% its only in that list once.... its why the medium price across all of NZ or indeed in each city is a better index IMHO
Clearly AKL is falling and stock is stacking up.
Agreed. Mortgage rollover pain still yet to be really felt, banks still supporting defaults, and rush to the brightine exit just starting.
Let's see what the second half of 24 brings.
I take a differing view as i think the effects of rollover pain have already been felt by most. Those who still need to rollover onto meaningful jumps', fixed in 2021 or earlier. They would have had meaningful wage inflation since then that will more than cover the increase in repayments they are about to face and have had plenty of time to plan for. Im talking in generalities of course and there will always be people who drop out at every point of the cycle.
Im sure some have. Recent article on here talked over 50% will meet that reality this year.
59% may be facing increased mortgage rates this year, however all of the 59% are not going from 2% rates to 7% rates, in fact pretty much zero are doing that as most people are on 1 or 2 year rollovers so they are already most of the way there already. Rates were cheaper shorter term, the lure is always to go with the cheaper rates with the possibility its even cheaper at the end of your term.
Yet I know more than a few in the late phase of 4 and 5 year fixes with a low 3% in it all furiously looking around quoting "rates are about to drop back to life support levels". Several of those are in Wellington, and are looking more than scared.
If they got a mortgage in 2020-2021, the servicing test rate was about 6.5% which is the same about what it is now. Most of us are going to be absolutely fine.
It's people who lose their jobs that are most at risk, its a horrible position to be in.
Exactly and absolutely. People lose their homes because of a change in their circumstances. Not a change in the interest rate.
More of prices going pretty much nowhere, up one month, down the next but over the calendar year going mostly nowhere.
Without high unemployment many of those sellers just don't need to sell. They're testing the market but prepared to wait it out.
I just dont think unemployment is very visible at the moment, feb this year there were 187 company liquidations versus 130 last year, jan was 63 vs 54. Its a bit cherry picky, but the last 2 calendar years, this year 1905 last year 1577 (march to feb). Previous year was 1362. Trend seems like more going to the wall. These are companies office stats
I think the effects of unemployment from the public sector slashing will affect the Wellington market. I'm not sure unemployment will have a meaningful effect at a national level because we are starting at a base of record low unemployment. I don't mean to be mean spirited in how I say this. But most people who risk unemployment are likely to be menial workers and not influencing the housing market anyway.
Good points.
There has been a surge in townhouses, minus 400m2 lot houses, apartments, and other intense housing situations that are skewing the median house prices down while HPI continues to make modest climbs.
Think back when Labour introduced the law to stop tax credits on mortgages for LL. All the economists MPs everyone in the know, cough cough said investors are going to flood the market didn't happen, again post covid all the know it alls said property is going to plummet again it didn't. Every investor I know ain't selling most are looking even with the change in brightline. Be careful who you listen too
Agreed. LLs should talk to an accountant before deciding to sell.
If they don't, they may be unpleasantly surprised when the IRD decides they do need to pay tax on what they thought would be an lovely untaxed capital gain.
Even more so when unemployment is touted to rise, and there's head count reductions in the public sector.
It wouldn't surprise me if staff at the IRD will go above and beyond to investigate every property transaction that takes place and send a nice little tax bill at their discretion. All in the name of job security/being seen to be productive. Here's the bill, please explain. Might be very difficult to explain, especially if it turns out some have loaded some of their OO debt against the rental.....
I see on the main Facebook Property Investment group this 'especially if it turns out some have loaded some of their OO debt against the rental.....' is suggested regularly LOL
Very very low sales volumes combined with only old cashed up buyers who don't mind overpaying and people who desperately need to buy now for whatever reason and can't hold out for further price drops.
Case in point, 80+ year old widow down the street sold his 4 bed home for $4million (probably a fair price). Bought the next door neighbours 2 bed apartment for $3M (overpaid by at least $550K). He's old, wants to stay on the same street, basically made the neighbours an offer they couldn't refuse (it wasn't on the market), has decided $1M is enough for him to live the rest of his life in the smaller apartment.
Gbogo, my thoughts are firstly we are not just one market across New Zealand. For example as Auckland prices drop, South Island prices increased. In my own area with big differences between towns, some with prices rising marginally( Carterton), some falling ( South Wairarapa). I also think the lack of volume of sales has an effect on the statistics. Here there are very few sales…. Agents saying the market is broken and only sales occurring are in lower end to first home buyers. So here lots and lots of property listed at high prices but only a couple have sold in the last 6 months. So no sales means no shift in the price index. Having said that I find the chart up above to not really represent the discussions and feelings locally around property. People are pretty gloomy about the massive stock of houses for sale and the lack of buyers.
Core Logic says they are still stuck in December.
If you mean their data, wouldn't that be "misrepresenting the truth"...?
I remember in 2010 after the GFC there was a stalemate where properties went neither up nor down for a couple of years. We are in that territory me thinks.
Except interest rates are much higher and unemployment hasn't yet happened (as it already had in 2010). Still someways down in my opinion.
Interest rates were circa 9% pre gfc. I know this as I was stuck on 9.18%! Eek
Yep. And OCR went to 2.5 in 2010. It really did save the property owning class at the time. How does that huge drop compare with today's situation? Steady property prices for a few years is not on the cards this time around and past solutions are not available.
There will still be properties that are sold x% above or x% below CV/Homes.co valuations and people will cling on to those anecdotes with hope.
This is one hell of a 'dead cat bounce'... perhaps the property market hasn't used all its 9 lives...
by Nifty1 | 4th Apr 24, 9:04am - "perhaps the property market hasn't used all its 9 lifes..."
Don't you mean lives.....?
When it suits, at some stage in the future, please feel free to point out how Core Logic data is out of date. Lets all agree REINZ HPI is the gold standard even once it commences falling again throughout April and reported in May :)
REINZ HPI was reflecting this also... your dead cat bounce theory is looking, dead.
by Nifty1 | 4th Apr 24, 9:51am - "REINZ HPI was reflecting this"
Yes - key word is WAS. I sense your anxiety. Lets hope I'm wrong :)
Not too cold, not too hot
...and about to be eaten by a bear.
The government needs tons of money and opening up the housing market again to foreign.
House price is a one way ticket, North!
NZ Housing has been a one way bet if you buy and hold for several years and the way the rest of the world is trending, NZ is looking better by the day.
rents inflate but interest repayments go down in time even if there is never capital gains. Basically. property rewards those who are stable and don't get divorced.
That’s a nifty coincidence- because house prices trending up is also a one way ticket north (literally, for young people heading to Aus and Nothern hemisphere for affordable housing)
'Not too hot, not too cold.'
Does this mean we have hit the 'just right - Goldilocks Zone'?
"Higher. For Longer."
Inflation,CPI,Real Unemployment, Excess Black Market Migrant Labourforce and the Recession. Austerity.
None of this 'tweaking' of regs and policy can overcome the onset of an economy about to be slammed by a period of Stagflation.
What next?
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