The property market in New Zealand is showing signs of gathering pace as residential property sales increased substantially in January compared to the same month in 2011. Latest figures from the Real Estate Institute show the number of transactions increased by 25% to reach 4,073 in January 2012 when compared to January 2011. Although this is a huge increase, January last year was notable for being the worst month ever recorded. Nationally the median sales price is $355,000, which is 4.4% higher than January last year.
The REINZ stratified house price index is just 3.8% below its peak in 2007 and has shown an annual increase of 4.3%. House prices are remaining relatively stable which may be down to buyers reluctance to take on too much debt due to continuing economic uncertainty.
The median house price in Auckland increased by 4.7% to reach $471,000 compared to a year earlier, and sales increased by 27% in January. Wellington house prices increased by 4.1% to $385,000 from January last year, and sales were up by 15%. In Christchurch property prices increased by 2.3% to $337,444, and property transactions rose by 4.1%. Dunedin house prices rose by 11% to reach an average of $245,000 while sales increased by 35%.
House prices are being held up by a shortage of homes, especially in Christchurch and Auckland. Auckland in particular has very few new homes coming onto the market and this is forcing property prices upwards. In spite of the fact that property prices are rising, they are not increasing at such a rate to fuel worries about a new housing boom, with property prices expected to rise by 3.5% this year.
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