Market Update: August 2023

Signs of optimism are returning to the real estate sector. The media is reporting signals of FOMO returning to major centres and quarter-on-quarter price declines are slowing signalling the bottom of the market in those areas is being tested. 

A steady July in Kerikeri with a total of 23 unconditional sales reported albeit 3 of these were lifestyle blocks sold in late 2021/early 2022 where titles have just recently been issued. That’s still up from the monthly average of 16 sales for the last 3 months. The house price index has dropped around 10% from the peak in the 3^rd quarter of 2022 in the Bay of Islands ward. 

All eyes are on the election this year as many investors wait to see if policy changes will make investment in housing more desirable. Section sales, usually a good indication of changes in consents and construction starts, are down nationally and locally but there appears to be enough work ahead for construction companies in the meantime. Some have already shifted focus to commercial or government contracts. 

Net migration figures have been higher than expected putting pressure on the rental market in Auckland. Some of these people will be eligible to purchase homes in a year or so. It is yet to be seen how the impact of people transitioning to higher interest rates as their fixed terms end will impact the market around the country. According to one recent report from ANZ, the number of people unable to pay their mortgages is less than projected. 

It also helps to see the sunshine a bit more often than in the first half of the year. This lifts the spirits and starts to get people thinking about making their next move. It is this time of year when we are busy preparing appraisals for the usual Spring rush of listings. Our advice is to move ahead of the herd and position your property on the market now while the stock is relatively low. In the end, prices paid are all relative to the economic principles of supply and demand so be ahead of the game to win.