Residential Property Price Sets Midyear Record

Residential property prices firmed last month to the highest June median ever, according to figures released this week by the Real Estate Institute of New Zealand (REINZ).

After easing back to $350,000 in May, the national median residential property price rose to $352,500 in June.  This figure is 3.67 per cent higher than last year’s June median of $340,000 and also an increase on the previous highest June median of $347,500 recorded in 2007.

Releasing the figures, REINZ President Peter McDonald remarked that the predicted post-Budget blues have not come to fruition and we are not seeing the forecast fall in prices.

“What we have is a genuine rather than a speculative market, with people seeking and buying homes to meet their own needs,” Mr McDonald said.

He did warn, however, that the REINZ statistics should not be taken as an indicator individual house values are still rising. They are purely the median of all sales during the month and can be impacted by the number of properties sold at either end of the price bracket.

“The average gap between listing and selling prices last month was relatively small at only four to five per cent which indicates successful vendors are being realistic in assessing the market value of their home,” Mr McDonald said.

Reflecting the traditional winter slow down of the real estate market, residential property transactions of 4575 last month were down on the May total of 5206, and sales of 6040 in June last year. But the total is more than the 4305 sales transactions recorded in June 2008.

“The national median number of days to sell increased from 43 in May to 45 in June but was over 60 days in Waikato/BOP, Hawkes Bay, Manawatu/Wanganui and Taranaki, and 86 days in Central Otago Lakes which suggests significant regional differences in the state of the property market,” Mr McDonald commented.

The total value of residential sales, including sections, in New Zealand in June was $1.96 billion, a decrease on the May total of $2.27 billion. The breakdown of the values of the properties was 156 for $1 million plus, 539 for $600,000 – $999,999, 1,162 for $400,000 – $599,999 and 2,718 under $400,000.

Movements in the median price varied widely from district to district across the country with falls as high as 11 per cent in 4 regions, and increases of up to 10 per cent in the other 8 when compared with the same month last year.

The largest rise in the median price was in Canterbury/Westland, which is up nearly 10.2 per cent on the previous year and the largest falls were in Northland down 9.6 per cent and Southland down 11.1 per cent.

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