Average asking prices on property website TradeMe Property declined for the second month in a row in May, suggesting vendors are becoming more realistic about their price expectations.
Across the entire country the average asking price declined by 2.3% in May compared to April.
The biggest decline for the month was in Hawke's Bay where the average asking price declined by 3.7% for the month, while Gisborne was the only district to record a rise, up 5.2%.
Around the main centres asking prices were down 2.3% for the month in Auckland, -2.0% in Wellington, -0.2% in Canterbury and -3.2% in Otago.
Trade Me spokesperson Casey Wilde said buyers were becoming more cautious and properties were staying on the market for longer.
"The median days on [the TradeMe Property web] site increased to 68 days for May, an increase of six days from April.
"When properties remain on the market for longer, we generally start to see sellers adjusting their expectations and asking price," she said.
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73 Comments
Not sufficient reason for RBNZ to lower the OCR.
TTP
No, but the next GDP report might be
Will be.
They won't though.
They won't. ... ... ... B'coz - you know - need to see what those tax cuts do. (But a really bad GDP result? Who knows ... )
Orr won't drop until it's too late. Rates will start dropping and Orr will be given the boot by years end
Some are already calling the bottom but other data is indicating this is just the start.
None of the DGMs are calling the bottom. They’ve been predicting drops since the day they were born, they had to be right at some point.
Many of us have been calling a decline since 2021 and continue to be proven right while the spec crowd attempt to control the narrative by calling a bottom for this damaged asset class.
Like Sideshow Bob, the spruikers keep stepping on rakes and it’s rather amusing…
Is the definition of a DGM someone who wants a productive, growing economy attracting skilled workers and a solid export market and retaining 0ur kids in a place they can develop careers and afford a house and have great public services and infrastructure? I think not.
Surely a DGM is someone who wants a rich poor divide, a property boom (risking asset bubbles) and economy that rests on real estate and immigration at the expense of everyone elses wellbeing?
Right now there is a need to control inflation as the priority, to make house prices affordable for the next generation (relative to salaries) and develop a economy with a focus on productive, export businesses.. which is a good thing. Also to grow our investments in nz in a sustainable long term way and develop some cool start ups to make money from. to achieve all that we need to prolong the OCR until inflation is back in its target for a while, til house prices are affordable for the next generation, to encourage the next gen to get productive useful jobs and start productive business (not real estate related jobs) and likely implement some additional controls like CGT - which will be AWESOME for the economy and most of the populkation and investors.
Surely the DGM is the one who wants a divided future that favors wealthy and landlords at the expense of the rest of the population and disfavors investment in productive business vs investment property? seems so to me
Top comment. Spot on.
For those like me that aren't sure what it means, but see a lot of references to it - does DGM = Doom & Gloom Merchant? Or something else?
It’s a pejorative term that spruikers here use to troll anyone who questions the narrative around a perpetual upwards trajectory of property prices and the associated disbenefits.
Yes it means ‘Doom and Gloom Merchant’.
We are nearing the end of the beginning though. Come on, give the people some hope...
We have not even fully defined the scope of this recession, local or truely global..,.,
they way china is and demographics I call this the initiation stage
Everything is changing globally..... the West is starting to spend big on military everything with real potential for Ukraine war to spread to Europe, Trump is likely to get back in power, there is a danger of either an AI bubble bursting (is huge now) OR AI will work and soon we will see significant numbers jobs slashed, USA is still in danger of a significant recession, Europe is a mess and about to start a trade war with China over EV's... NZ is getting closer to china (at great risk)... voters globally are getting very right wing... israal is a mess... etc
Anyone who can forecast how this will all affect the global economy in the future and thus how we will get on - is a serious soothsayer
Trump is likely to get back in power
Really?
could go either way
I wouldn't be surprised. Sadly.
The voters are very unhappy - look what just happened in Europe.
Like in the Uk and here - if the status quo isnt working the sheeple will vote for the other guy.
Trump is favorite at the bookies
..enter Kennedy
54% chance according to Betfair right now. 35% chance of Biden winning (balance is Michelle Obama, RFK, Newsom, Harris and a few other bits and bobs)
The issue is, like here, that too many have no idea what they are really voting for and are voting for the 'other person'. If we had a better general level of intelligence and engagement in local, national and international politics that spanned more than just whatever drivel is spoon fed to us by mainstream media, we would see the masses demanding change for the benefit of the majority, where most people gain over the medium to long term. Instead we are a product of social media and mainstream media: Short term thinkers with short attention spans who want instant gratification with no sacrifice, and refuse to take any accountability or make hard decisions that will hurt in the short term, but benefit in the long term (delayed gratification).
Hopefully
Go Gizzy!
Are you feeling ok
Fine thanks. Oh - you're not going to follow me around the threads again are you? This has happened before and the word creepy comes to mind.....
Edit :)
The gizzy comment seemed out of character, must have been sarc then. Leave being a chameleon (and comedian) to others
Creep.
Japan bid up its land prices to insane levels which peaked in 1989. It took until about 2009, or 20 years to unwind.
NZ has done the same thing with housing land prices. The land prices peaked in late 2021 giving us some of the highest house price/income ratios in the world. It's going to take time for real (inflation adjusted) land prices in NZ to retreat to realistic values. The longer we run unsustainable net inbound immigration rates the longer the unwind will take.
Land prices were artificially high for a bunch of reasons.
But a major reason was Council zoning policies which needed a lot of land just to build a single occupancy house. Many of those restrictions have now been removed in favour of far greater densities. The net result will be land prices falling on the outskirts of major metro areas (could be big falls too) but 'well connected areas' will, as you say, will "take time for real (inflation adjusted) land prices in NZ to retreat to realistic values."
My general advice ... Take great care thinking about buying those 6+ bedroom / 4+ bathroom McMansions that have been built on the outskirts and all need multiple cars to get anywhere. Ignore the 'big price reductions'. They could become slums as the result of exceptionally bad planning by Councils.
This outcome is really great news.. it's an indication that vendor's IQ have increased as a result of them pulling their head out of the sand
Issue with vendors IQ or buyers IQ who paid insane prices up to this point??
Agree it was both ways.. but buyers seemed to have changed over the past 2 years, while vendors are just about coming up to speed
A house is not optional. Everyone needs somewhere to live.
NZ has some of the highest:
house price / income ratio
rent / income ratio
Kiwi's are screwed either way.
Let me correct you, “owning” a house is optional to some - who would rather have debt in depreciating assets like cars etc. Evidence? Join the first home buyers page on FB - nearly all of them have some sort of stupid debt. Don’t expect to buy a house any time soon when you’ve made certain questionable decisions.
It’s so good having your robust educated well researched insights iceman /s
Spoken like a stereotypical boomer….
Boomer? Remember what the first three letters of the word Assume mean.
For the record - I’m not even 40. I’ve just made decent decisions along the way.
Way to sound like an idiot.
Amokk said "Spoken like ...". They didn't actually say you were a boomer. Just that your comment sounded like it could have come from a boomer.
And a few years back just about every boomer did sound like that.
Not so now.
Many are figuring it out, or have already figured out, what's happening. Especially as it relates to supply and how it will increase thanks to central & local government driven up-zoning. I'm the last of the boomers and none of the other boomers I know are doing anything except selling or thinking of selling. None believe there will be a return to the good old days. My mum, among the very first of the boomers, liquidated almost all her properties during covid madness and the last went about a year ago. (She has some expert advisers.) She's now decided she doesn't need all that money and is dispersing some of it to her children. (Thanks ma.) She's doing that now because she sees a chance of a return of inheritance taxes (like she grew up with ... and like the many other countries have).
Excellent Chris. Buy a house! But be quick….
Creating new dwellings is my thing.
You regularly sound like an idiot, to be fair.
I don’t even comment on here regularly. Honestly - it’s people like you who just talk a lot of crap that fill up most comments on here.
small data set
Rents and house prices re falling.
KPIs look good for the NZ economy in the mid to long term.
If I was an agent I'd drop the asking price (which buyers dont directly see) on trademe to try and get more eyes on the property and foot traffic at open homes... it doesn't necessarily mean that's what the vendors want to sell for.
Any prospective buyers who have been looking for a while know agents aren't worried about wasting their time.
Many of them have been doing this forever anyway - what makes you think they aren’t atm?
Oh, they most definitely play this game. Which is part of why so many people find their practices borderline dishonest.
Many people find their practices highly dishonest. This is not "borderline" dishonest.
If I was an agent I would be honest about the price levels in today's market. If vendor is still in 2021 lala land then don't waste my time.
You'd be one of those agents in the dole queue...
Nah. Got several agent friends who are doing this and they are busy selling as ever. They are just not wasting their time on speculative fantasy land.
Dropped ours considerably below CV as I considered it a nonsense. Got the place sold in about4 weeks some months back. I reckon now be down another $100k easy on what we got.
Wifey bit grumpy at the time...told her be patient and you will see.
I am now allowed out of the kennel and sometimes get a pat.
Well done, that’s known as getting ahead of the game. I bet there will be a few out there who wished they did the same.
I did the same to my father, pushed him to cut his price from the $900k he thought he would get, to $850k after it had sat on the market for 6 weeks with a failed auction and no offers. Then pushed him again to accept a $837k offer he got after wasting another 6 weeks waiting on a $845k offer subject to the sale of the buyers house which never happened. House is now probably worth less than $800k.
Oh the humanity...
🔥
For the 'fearless' speculator a bargain awaits......lol ... Is any one feeling tough and bold...? My guess is its a mountain too high for many. Is this the 'Everest' of RE in NZ ?
https://www.stuff.co.nz/nz-news/350306337/idyllic-waterfront-property-h…
Saw this article this morning. There is no greater sign of an impotent system of authority. Where I come from this situation would be used as a multi-force training exercise and would be over by morning tea. It's pathetic.
Those who should know, know what's coming...
"Two weeks before his house goes to auction, real estate patriarch Garth Barfoot is showing his hand. The four-bedroom waterfront home... will be sold with a declared reserve.... more than $1m below the CV."
Now, of course, it's all marketing, but in times gone by it would have all been left up to any buyer to have a first-stab at what it might go for, and been told "That's nowhere near enough!"
Look a line of chickens coming up the driveway...
great time to make fried southern chicken
If average wage couple did manage to save a deposit they still wouldn’t be able purchase a average home in most areas even with the 20% drop already seen from highs, the crash will continue For sometime until more of the population has a chance of buying a home
The average wage couple earns $110000 per household. Using my ASB mortgage calculator and assuming they have a 20% deposit as stated, they can borrow for a 1.1 million dollar house. The average house price is currently $780000.
At the same level of expenditure and assuming average rent it would take them 4 years to save the 20% deposit from zero for the median house.
I'm not saying you are wrong but things are not as bad as some make out.
Hang on, the last average I saw was 117k, nevertheless, that would be Debt on the incoming 6xDTIs total borrowings of $702k - Still way too much and very dangerous!
Negative equity comes next, I fear for them, as many thousands have seen since 2020.
The 117K household should borrow no more that 4xDTI, so borrowings of $468k max, are much safer to deal with, in the current and ongoing property crash.
I think the 4xDTI was often floated as a threshold for safety when we had 20 mortgages. Now that 30 year mortgages are the norm, a 5xDTI should be fine in most people's circumstances. I agree the 6xDTI is dicey and shouldn't be entred lightly.
Just put 120000 income for couple into ASB calculate for mortgage came back with could borrow 620k and with 155k deposit so total house price would be 775k no sure where you got 1.1 million from. Like I said very little chance of buying a good 3 bedroom home in most areas also put in had no credit cards or loans how many people don’t already have debt and still need to have the 155k deposit.
Fair enough. I just checked and it seems I had missed a zero in monthly expenses! But it still shows borrowing potential of a 900k house for me though which would be fine as a first home in most areas of NZ.
The deposit is still the capacitating factor for most FHBs.
I can't agree that a 1st home is worth 900k in most parts of NZ? Maybe a couple but certainly not most.
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