Blow for buyers as housing market rebounds

Anyone who was hoping signs of weakness in the property market would turn into a more permanent drop looks set to be disappointed.

New data from the Real Estate Institute of New Zealand (REINZ) showed a lift in March in the median sale price, sales volume and market activity.

The national median sale price rose $51,000 to $546,000 in the month, a new record. Auckland’s median was $890,000 – up 8.5 per cent on March 2016.

Auckland, Northland, Waikato/Bay of Plenty, Hawke’s Bay, Manawatu, Taranaki, Canterbury/Westland and Otago all reported record median prices.

Northland had the biggest year-onyear increase in median price, up 27 per cent.

There were 8504 sales in the month, 36 per cent more than February but 11 per cent fewer than March 2016.

‘‘March reflects the seasonal peak for the year so far, with the largest number of homes sold and the largest month-onmonth increase in the median price, as we normally expect to see this month,’’ REINZ chief executive Bindi Norwell said. ‘‘Auckland has recorded another record median price and a 66 per cent jump in sales volumes on February, but it should be noted that the ‘March effect’ is more pronounced in Auckland than in other regions.’’

But the number of properties available for sale across New Zealand is down compared to 2016, with 2397 fewer homes on the market.

Nationwide, it would take 32 days to clear the stock on the market, at the current rate of sales. That is two days longer than the same time last year.

ASB chief economist Nick Tuffley said the data seemed to indicate the market had found its floor.

There had been a rebound in every region except Taranaki, he said. ‘‘It looks like there is a general pattern of sales starting to recover.’’

He said there were strong signs that the market had got back to business as usual after the introduction of tighter lending rules for investors and a recent increase in mortgage interest rates.

‘‘That’s the view we had of what it would do when the new restrictions came in – there would be an impact for six months and then wear off and that’s the signal we’re getting,’’ he said.

‘‘Prices are a bit firmer after Auckland seeing slight outright price declines at the start of the year. There’s a bit more stability coming through.’’

QV statistics released this month showed Auckland prices falling but they are based on settlements, rather than unconditional sales. That means the QV data tends to lag the REINZ information.

Tuffley said buyers should not expect to see a return to rapid price growth but there would be moderate increases through the year.