Quotable Value (QV) says house prices were "relatively static" last year and are likely to stay that way as the market heads into 2025.
"Our latest QV House Price Index shows residential property values edged upwards by an average of just 0.1% nationally in the December quarter, which was not enough to finish the year in the black," QV Operations Manager James Wilson said.
"The average [New Zealand] home is now worth $902,414, which is 0.3% less than at the start of 2024, and 15.2% below the market's peak just over three years ago."
"Now that flattening trend looks set to continue throughout the early part of 2025, with little evidence to suggest that property values are set to grow substantially this summer," Wilson said.
"It's been steady as she goes throughout much of last year, and it looks like it's going to stay that way for a while yet."
"It's a new year, but the same restraining factors are still very much at play, including sustained weakness in the labour market, a high cost of living, credit constraints and a surplus of properties for sale," said Wilson.
"The marked uplift in demand for housing that has come as a direct result of falling interest rates hasn't yet converted into any significant price pressure, so we're only seeing very small pockets of growth."
"However we also haven't seen quite so many reductions this quarter in particular, which indicates that we're now at or very close to equilibrium in the market," Wilson said.
17 Comments
Unlike the REINZ QV acknowledge what is actually happening in the housing market. A large increasing inventory, interest rates that are still high, a high cost of living in NZ, increasing unemployment and New Zealanders leaving to live overseas. All of the above factors can only lead to a challenging market.
Given the increase in average house prices over the decade leading up to November 2021, the market’s cooling-off over the last three years has been relatively mild. Notably, it’s been far less dramatic than many people here predicted.
By and large, property owners/ investors/ speculators have sought to hold on and ride out the downturn in the market.
Market activity might well strengthen a bit over 2025 but in a “fits and starts”, non-linear manner. The stock of unsold houses remains high, so I can’t see a big jump in average house prices anytime soon. Bank forecasts seem too optimistic to me - but we’ll see.
TTP
Much of what I watch has sat for months. Then one sells and at price that really surprises - its as if the buyer is new to the area or just have to buy now.
These one off high prices likely provide enough reason to hold out in the hope you will find same. BUT...so many sitting unsold I wonder how much longer they can hold, surely they will want to sell before the approach of winter?
Perhaps its not gonna happen, but the strain out there tells me it will.
Nice looking "recovery" there bro
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