New Zealand property prices could fall by 10%

The housing market in New Zealand could fall as much as 10% in the next few months, investors are warned.

According to the Real Estate Institute of New Zealand, data shows that housing prices may begin to fall, and could fall as much as 10% in the months ahead. This comes in as the institute considers February's sales numbers, which are the slowest since March of 2001. As this happens, it also pushes sale times to take longer.

As of February's reports, the median price of a home moved from NZ $340,000 in the month of January down to a national median of NZ $337,500 in February. In comparison, these numbers are bleak especially when seen as a small 0.7% increase over the same time in 2007.

The number of homes that sold also dropped. This number dropped by 32% from 9,357 in February of 2007 to just 6,356 homes in February of 2008.

According to Bloomberg News, Shamubeel Eaqub who is economist at Goldman Sachs JBWere LTD said,

"The slowdown in the housing market will weigh on household spending and residential construction, which have already shown evidence of weakening." He added, "The economy is rapidly losing momentum."

As the country is rated on having the most expensive properties in the world, a downturn in the housing market may be a good opportunity for investors who have been holding back to get into the market.