Stability and balance
Speaking of heat, after quite some time the news is no longer filled with headlines of the outrageously hot Auckland housing market, record high house prices or housing unaffordability.
The latest statistics in from the Real Estate institute of NZ showcase the median sale price across New Zealand as having dropped $4000 to $516,000 in December.
In Auckland, the median sale price last month was $840,000, down 1.4% on November's $852,000 ($868,000 in October).
Sales volumes in Auckland were down by 2% and, nationally, sales dropped by 11% comparing December 2016 with December 2015.
What this says is that, while there are still plenty of buyers, the rush has slowed and we are now in a more balanced market.
Over the past six months we’ve seen properties starting to take longer to sell. This is due to a number of factors, but has resulted in sellers needing to adjust their perceptions somewhat and buyers now being able to take their time just a little more.
Ongoing supply issues and a growing population in Auckland are being countered by higher fixed rate home loans and the 40% LVR on investment properties.
REINZ's CEO Bindi Norwell says the underlying trend is one of rising prices across New Zealand coupled with flat or falling sales volumes in many areas of the country. "In Auckland, the long-term median price trend has been consistently rising, despite a slight easing compared to November 2016," she says.
Let me finish by positing that with a balanced market comes an element of stability; and stability and balance protect against a housing bubble: prices remain strong (even if their year-on-year growth is at a more steady rather than stratospheric rate); and increased supply and known affordability encourages and entices buyers into purchasing a home.