Spring has sprung, and with it comes a wave of optimism in the New Zealand real estate market. According to the latest figures from the Real Estate Institute of New Zealand (REINZ) for September 2024, house prices are beginning to stabilise, and confidence is rising among both buyers and vendors. Combined with favourable economic conditions, the stage is set for buyers to capitalise on a unique moment in the property market.
Key Insights from the September 2024 REINZ Report
Stabilising Prices and Growing Confidence
- The national median price decreased slightly year-on-year by 2.3%, from $799,000 to $781,000. However, it increased month-on-month by 2.1%, showing early signs of recovery.
- Excluding Auckland, the year-on-year median price drop was a modest 0.7%, while month-on-month prices rose by 2.2%.
Regional Performance
- Eight of the sixteen regions experienced a median price increase year-on-year, with Gisborne (+10.1%) and the West Coast (+9.9%) leading the way.
- Month-on-month, twelve regions saw price increases, including notable jumps in Southland (+14.1%) and Marlborough (+9.7%).
Market Activity and Inventory
- Nationally, sales volumes dipped 1.1% year-on-year but increased 4.5% outside Auckland. Seven regions recorded year-on-year sales growth, with Hawke’s Bay (+26.3%) and Gisborne (+22.6%) showing the largest increases.
- New listings surged in many regions, with Gisborne (+50.0%), Wellington (+36.1%), and Otago (+34.1%) seeing significant growth. This increase in listings gives buyers more options and time to make informed decisions.
Improved Buyer Engagement
- Local agents report higher attendance at open homes and increased enquiries, indicating growing buyer interest. These trends suggest a more robust market could emerge in the coming months.
Interest Rate Reductions Boosting Optimism
- The Reserve Bank’s decision to lower the Official Cash Rate (OCR) by 50 basis points to 4.75% has sparked optimism. Further reductions anticipated in November are expected to bring mortgage rates into the mid-5% range, offering relief to buyers.
5 Reasons Now is the Perfect Time to Buy
- Prices Are at Their Lowest - House prices have stabilised after several months of decline and are now at levels unlikely to be seen again as the market moves toward a new growth cycle in 2025. Buyers who act now can secure properties before prices begin to rise again.
- Mortgage Rates Are Dropping - With the recent OCR reduction and another expected in November, mortgage rates are set to decrease further. Predictions indicate that 1-year fixed rates could fall to the mid-5% range, making borrowing more affordable.
- Vendors Are Motivated - Properties are taking longer to sell, with the national median days to sell now at 49 days. This gives buyers an advantage, as many vendors are keen to negotiate and finalise sales quickly.
- Increased Choice for Buyers - A 27.4% increase in national inventory year-on-year means buyers have more properties to choose from. The rise in listings also means less competition, giving buyers the time to find the right property without feeling rushed.
- Market Recovery is Imminent - As confidence grows and interest rates decline, the market is expected to enter a recovery phase in 2025. Buying now allows you to get ahead of this growth cycle, potentially reaping future capital gains.
Looking Ahead
The New Zealand property market is entering a period of stability and opportunity. With house prices at their lowest, mortgage rates on the decline, and a motivated pool of vendors, buyers are uniquely positioned to benefit.
At Professionals Real Estate Group, we’re here to help you navigate this market and find the perfect property for your needs. Contact us today to explore your options and take advantage of these favourable conditions.
Your dream home is closer than you think — let’s make it happen together.
