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Residential Update January 24

Canterbury’s residential property market has started 2024 with a warm welcome with the news that, according to the latest survey by ASB, for the first time in eighteen months, more New Zealanders expect house prices to increase than decrease.

Articles-Residential.jpg The bank’s latest Housing Confidence Survey highlights that with property prices no longer falling, or not falling by anywhere near as much as they did in late 2022/mid 2023, Kiwis tend to think the housing market has reached a turning point.

Released just before Christmas, the Housing Confidence Survey indicates that a net 34 percent of respondents expect housing prices to rise from here on in. This is a big shift from where house price expectations were in early 2023 – when a net 43 percent of ASB survey respondents expected prices to fall.

“This is the first time since April 2022 that those expecting prices to rise has outstripped those expecting them to decrease - an important milestone,” the ASB Housing Confidence Survey states.

Looking at the Canterbury region’s residential property market with a microscope, the latest Real Estate Institute of New Zealand statistics show that median house prices in the Christchurch City area rose by 3.1 percent in a 12 month period to December 2023 – rising from $650,000 to $670,000.

In comparison, the REINZ data recorded median sale price falls in the provincial Canterbury locales of Ashburton, Hurunui, Selwyn and Waimakariri.

Meanwhile, the latest REINZ stats for Canterbury highlights that the current ‘median days to sell’ figure of 31 days is the same as the 10-year average for December. There are now approximately 14-weeks of residential property inventory in December 2023 for buyers to choose from – which is four weeks less than the same time last year.

Analysing recent activity trends across the Greater Canterbury region, REINZ chief executive officer Jen Baird noted that most vendors were now setting their price expectations to meet the market.

“Owner-occupiers were the most active buyer group in the region, with first-home buyers also being active in Christchurch,” Ms Baird said. “Open home attendance numbers were steady in Christmas before tapering off close to the holidays. In Christchurch there were good levels of attendance at auctions, clearance rates varied, and many properties were sold through negotiation in the auction room after the auction call.

“Interest rates and the cost of living continue to have a significant influence on market sentiment, and local Canterbury real estate agents reported (in December) that some buyers and vendors have a ‘wait and see’ approach while others are acting now.”

Canterbury’s residential property market is finely balanced at present. On one side, housing demand has had a big boost from strong net migration but supply isn’t keeping pace. On the other hand, interest rates are still viewed as “high”, acting as a constraint on activity.

Anecdotally as we head back into action after the holiday period, the residential sales teams at Bayleys Canterbury are hearing feedback from open homes, that despite generally favourable economic sentiment, the spectre of interest rates hovering around the seven percent mark is still weighing heavily with many potential purchasers.

The Bayleys Canterbury residential sales team is always available to share our market knowledge with both vendors and potential buyers. Please give us a call or get in touch if you’d like to know more about the data presented here, the market in general or indeed your own home’s value.

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