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News Australasia Property sales and loans decline in New Zealand but prices reach a record high, figures show
News Australasia Property sales and loans decline in New Zealand but prices reach a record high, figures show
Property sales and loans decline in New Zealand but prices reach a record high, figures show |
| Friday, 23 April 2010 | |
 New Zealand property prices There are fewer property sales and loans being processed in New Zealand as potential buyers display pre-budget jitters but prices have recorded a record high. The number of people who received mortgages in the first quarter of this year saw a record 30% decline on 2009, as house sales stalled and investors threw caution to the wind about possible tax changes in the budget. One-third fewer mortgages were approved in the 13 weeks to April 9, compared with the same period last year, while the overall value of loan approvals dropped 25.2%, according to the figures compiled by the Reserve Bank of New Zealand from about 95% of home loan lenders in the New Zealand market. According to property expert Olly Newland property turnover had slowed, reducing the numbers of mortgages being approved as some investors were being spooked by speculation the Government could stop property investors claiming depreciation tax breaks in the May 20 budget. At the same time more people were renting as they came to realise it was cheaper than owning a property, while capital gain remained so elusive, he said. Lee Hatton, Head of Retail Northern Region, at BNZ said overall the market had softened with prospects for new lending slowing down. ‘In comparison to this time last year, we have seen less customers looking for approvals but our overall approval rate has actually increased for this period,’ he explained. Goldman Sachs JBWere economist Philip Borkin said talk of changes to the tax system on property investment had left many investors sitting on the fence while a sharp rise in longer-term mortgage rates had also added to the dip in numbers of people taking out loans. But the latest figures also show that property prices reached a 20 year high for the month of March. The median sale price of homes rose to $360,500, some 7% up on the same period last year, and the highest March figure in 20 years, according to the data from the Real Estate Institute of New Zealand. REINZ president Peter McDonald said the apparently strengthening market was an encouraging sign. ‘Despite an abundance of good listings at present, we are still seeing prices going up as a result of strong demand from genuine home buyers,’ he explained. McDonald said the figures were in contrast to November figures when listings were short and prices went up because demand was not being met. The largest annual percentage increases were in Auckland, up 9.31% and Taranaki, up 8.52%. Southland also showed strong growth with the annual median price rising more than 5.3%. Another indicator of the strengthening market was the recorded fall in the median number of days which fell from 46 to 35 from February to March. Sales were quickest in Wellington, Canterbury/Westland and Otago at 29 median days.
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Earlier News
- Serious drop in first time property buyers expected in Australia 16/04/2010
- Demand in New Zealand real estate market weak but Auckland bucks trend 08/04/2010
- Oz launches investigations into foreign real estate buyers 07/04/2010
- National shortage of property set to drive real estate prices higher 01/04/2010
- Agents highlight new appetite for luxury property in New Zealand 23/03/2010
Australasia: Top Headline
New build sector being held back by lack of lending and financial constraint, says HIA{mosimage} Cautious household attitudes are continuing to restrain expenditure on residential construction in Australia, although many prospective buyers are being impeded by tight credit conditions, it is claimed.
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