REINZ figures show drop in lifestyle property sales

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Lifestyle property sales have taken a tumble and the Real Estate Institute of New Zealand says volumes could continue to ease.

In a statement, spokesman Brian Peacocke said Auckland and Bay of Plenty were most impacted.

Nationally, sales fell from 2317 in June last year to 1555 for the three-month period ending June this year.

While explanations gave rise to conjecture, the combination of increasing interest rates, inflation, supply-chain-affected cost structures and the ongoing effects of Covid-19 - the same as in the residential market - were likely leaders in the causes being espoused, Peacocke said.

"Given also the added impact from the mix of the current wet, cold winter conditions and the current economic conditions, it is quite feasible that total sales volumes of lifestyle blocks will continue to ease," he said.

Data released yesterday showed 209 fewer lifestyle property sales for the three months ended June this year than for the three months ended May.

There were 7896 properties sold in the year to June, 3342 or 29.7 per cent fewer than in the year to June 2021.

The median price for properties sold in the past three months was $1.03 million, $115,000 higher than the three months ended June last year.

In Otago, sales increased 29 per cent and the median price lifted 15 per cent while sales nose-dived in Southland by 31 per cent and the median price dropped 37 per cent.

Otago recorded the longest times to sell, at 67 days.

Four regions recorded an increase in the number of farm sales for the three months ended June, the most notable being Southland, up eight sales.

There were 81 fewer farm sales for the three months ended this June than for the same period last year.

The median price per hectare for all farms sold in the three months to June this year was $28,040, compared with $27,180 for the three months to June 2021.

Projected income levels for the forthcoming season for dairy products, beef, lamb and horticulture were encouraging but, to date, had been insufficient to change the mood of inherent caution prevailing within the rural sector, or to offset the combined effects of regulatory control, compliance costs, difficulties with labour and the increased costs for inputs, Peacocke said.

"When those issues are combined with the impact of supply chain constraints, increasing interest rates resulting from the recently increased official cash rate plus inflation hovering around 7 per cent, there is every reason for the rural sector to be both cautious and more than a little frustrated with the current economic environment."

The results of farm sales activity over the next 12 months would be an interesting reflection of those issues, he said.

In Otago, there was light sales activity in the finishing and grazing categories, well spread across the Waitaki, Dunedin, Clutha and Central Otago districts.

In Southland, there was a "great run" of sales of dairy, finishing and grazing properties.