The month saw softer prices and volumes with the national median price falling 5.8% to $402,000, a record high that was set in December 2013. Sales were down 17% in January month on month and are now down 4.3% compared with January 2013.
However, prices are still 8.6% up on January 2013 and the Nelson/Marlborough region reached a new high median price of $380,000.
‘There were a number of factors in play in the market in January, including seasonal factors and the ongoing impact of restrictions on high loan to value lending. As a result it is difficult to get an entirely clear steer on the direction of the market this month,’ said REINZ chief executive Helen O’Sullivan.
‘Volumes are still strong relative to the last five years, but are down 4.3% overall on the same time last year. The softer volume result continues a pattern that began in November and continued in December. However, market feedback suggests that first time buyers may be tentatively returning to certain markets,’ she explained, but added that this is by no means a consistent message, with views decidedly mixed outside of the main cities.
She also said that a softening price trend could come as a relief to many commentators. ‘However January data is often impacted by the seasonal mix of properties, with fewer high value properties coming to market in this month,’ she pointed out.
The Stratified House Price Index, which adjusts for some of the mix issues, is down by 2.2% compared with December 2013.
O’Sullivan said that it also of interest that a small but steadily increasing number of properties coming onto the market in Christchurch are being sold on an ‘as is, where is’ basis, that is, damaged and unrepaired.
‘Prices achieved can range from full value for lightly damaged properties to land value less demolition costs for severely damaged dwellings. We will be taking a close interest in this trend as it develops,’ she added.
Although sales were lower than normally expected for the time of year, four regions recorded increases in sales volume compared to January last year, with Central Otago Lakes recording the largest increase of 39.8%, followed by Northland with 11.9% and Hawkes Bay with 8.6%.
Four regions recorded an increase in sales volume compared to December, with Manawatu/Wanganui recording the largest increase of 20.1%, followed by Taranaki with an increase of 6.1% and Central Otago Lakes with an increase of 5.5%.
While the total number of sales was down 4.3% compared to January 2013, the number of sales below $400,000 fell by 15.6%. This follows a fall in sales below $400,000 of 16.8% between December 2012 and December 2013. REINZ said that this may be indicative of fewer sales in the lower price brackets since the imposition of the LVR restrictions.
The data also shows that 10 regions recorded an increase in the median price. Some 69% of the increase in the national median price compared to January last year occurred in Auckland and 13% occurred in Waikato/Bay of Plenty. Christchurch contributed 10% of the increase in median price over that period. Together these three regions accounted for 92% of the increase in the median price between January 2014 and January 2013.
Nelson/Marlborough recorded a new median high in January of $380,000. Auckland’s median price softened, down $31,000 from December 2013. Compared to January 2013 Nelson/Marlborough recorded the largest increase in median price, up 11.8%, followed by Auckland with 11.7% and Otago with 10.9%.
