The property market defied expectations in June with the majority of the metrics measured in the REINZ Residential Market Confidence Report returning to ‘normal’ this month – and in fact, sales volumes were the highest REINZ has seen for a June month in four years.
The REINZ Residential Market Confidence Report for June revealed that the number of properties sold has progressively increased steadily throughout the month, as did listings, which were the strongest for the month of June in four years and are now providing more choice for buyers. Additionally, the number of Comparative Market Analyses (CMAs) completed by agents has increased, which would suggest an uplift in listings in the next few months.
REINZ chief executive Bindi Norwell says: “The strong confidence people have in the market has been clear for all to see in auctions rooms around the country, with the market going from strength to strength each week. Auctioneers are reporting competitive bidding resulting in strong price outcomes for vendors, and the total percentage of auctions exceeded the proportion of auctions we saw last June. There are no signs yet of this confidence dissipating, not something we would have predicted a couple of months’ ago.
"No one could have (or would have!) predicted this result back in April. And even if anyone was so bold, to have made this sort of prediction, their integrity and potentially their credentials would have been questioned.
REINZ chief executive Bindi Norwell says no one wants wild changes in prices or sales volume.
“The median sales price to valuation ratio has returned to where we saw things pre-Covid, with properties selling on average for 13 per cent above CV across the country and the median number of days it takes to sell a property is also slowly coming down.
“Kiwis returning home to continue to play an important role in the market, with some agents reporting family members here in New Zealand visiting open homes on behalf of overseas family members. Other agents are reporting expats buying properties sight unseen, similar to stories we heard last month.
“If it weren’t for the continuing headlines on the front pages of our newspapers outlining Covid-related job losses and the impending end to wage subsidies and mortgage holidays in just two months’ time, we might be able to call the end to the impact of Covid-19 on the property market. However, as there have been many balancing factors impacting the real estate market over the last few months, this is unlikely to be the case."
Norwell adds that estate agency heads were pleased to report that by June price volatility appears to have evened out: "No one wants wild changes in prices or sales volumes. That is not good for anyone and just creates uncertainty in a market."
As well as sales volumes, days to sell and sales prices, the REINZ confidence measures include percentage of auctions, number of new listings and appraisals and feedback from real estate agents.