New Zealand's overheated housing market - considered a risk to financial stability - has slowed as Reserve Bank restrictions on more highly-leveraged mortgage lending and tighter credit criteria being demanded by banks made it more difficult for borrowers. Housing market sentiment had also been weighed by new government policies to restrict the sale of homes and property to foreign investors.
The REINZ house price index lifted 3.4 per cent year-on-year in January to 2,655. Excluding Auckland, it was up 6.6 per cent on the year. Auckland's house price index increased 0.1 per cent versus January 2017. The index considers the mix and value of the property sold, not just the sales price. Six regions - Northland, Waikato, Bay of Plenty, Manawatu/Wanganui, Otago and Southland - reached new highs in January, REINZ said.
The median house sale price lifted 7.1 per cent to $520,000 in January versus a year earlier when it was $485,000. Auckland's median price decreased by 1.2 per cent to $820,000 down from $830,000 at the same time last year. In Otago, the median price lifted 33 per cent to $475,000.
"House prices across the country continue to hold up with 14 out of 16 regions experiencing a year-on-year price increase. Otago's record price for January was driven by a strong increase in Clutha and the Central Otago District – up 53.4 per cent and 39.4 per cent respectively," says Norwell.
The number of properties available for sale nationally increased by 7 per cent to 25,503 versus the prior January. Excluding Auckland, the number of properties available for sale increased by 1.1 per cent to 16,824.
The number of homes sold between $500,000 and $750,000 in January represented 27.8 per cent of all sales versus 25.2 per cent a year earlier. The $750,000-to-$999,000 bracket lifted to 13.5 per cent from 12.9 per cent while the $1 million-to-$2m category rose to 10.1 per cent of the market from 9 per cent.