Source: Radio New Zealand
RNZ
There is likely to be another six months of little house price movement, property data firm Cotality says.
It has released its latest data, which shows property values fell 0.1 percent in January.
The median value was $802,617, 1 percent lower than a year earlier and 17.5 percent below the early 2022 peak.
Standalone houses fell 0.7 percent over the 12 months to January. Townhouses were down 1.7 percent and apartments 4.1 percent.
Auckland values were down 0.3 percent in January and 1 percent over three months, and Wellington’s were down 0.1 percent and 0.5 percent over three months. Hamilton and Christchurch were flat while Tauranga values lifted 0.3 percent and Dunedin’s 0.4 percent. Queenstown prices lifted 0.8 percent in the month and 1 percent over three months.
Chief property economist Kelvin Davidson said it was a continuation of the flat activity seen through last year.
“At the moment buyers still seem to be in the ascendancy and values are flatlining,” Davidson said.
“New borrowers and also existing mortgage holders will be feeling the benefits of lower interest rates and be more able to act in the market.
“But there’s still a good stock of listings out there for buyers to choose from and a cautious attitude persists, especially as the recovering economy has yet to improve job security and employment levels.
“The net result is that buyers aren’t in a rush to bid up prices, although vendors aren’t generally having to drop their expectations much either.”
He said it would be interesting to see what housing market policies were presented by politicians heading into the election and what that might mean for buyers and sellers.
Davidson said recent talk about the potential for earlier official cash rate increases might have made some households nervous, but weak unemployment data on Wednesday may have changed the picture again.
“For a while there it was a growing view that we’d see OCR increases sooner rather than later but maybe that view’s being back-pedalled a bit off the back of the labour market numbers.
“I think the tone of the commentary is just shifting a bit towards there’s no rush and the OCR increases might not be coming through straight away, so that probably gives some reassurance to the housing market. But at the same time, there’s other possible restraints in the form of debt-to-income ratio limits and housing supply has increased.
He said it was likely that house prices would rise slowly this year.
“It’s not hard ot image things trending sidewards a bit further.
“Sentiment still seems to be fairly cautious… Some of these forces are pushing against each other at the moment. I think probably what it really takes is that economic recovery to get a bit more strength and really start to push the unemployment rate down. That might not be a consideration until maybe the second half of the year.
“It could be a year of two halves in some ways for house prices – the first half of the year is trending sideways.”
He said first-home buyers might not remain such a high share of activity, but were likely to be a strong force this year.
“Meanwhile, investors have also returned to the market but will be keeping a close eye on the politics, particularly around a possible capital gains tax and any discussions about interest deductibility.
“All in all, it could prove to be another relatively subdued year for housing in 2026.”
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
