Market Update – October 2020

Highest sales count for an October month in 17 years

Auckland median house price hits $1M mark in October; 9 other regions and 28 districts around the country saw house prices reach new record medians in October. This shows how low interest and mortgage rates, the diversion of spend on overseas travel to property, expats returning home, the removal of LVRs and a fiercely competitive market due to the lack of listings have all been contributing to price rises over the past few months.

But the frenzy doesn’t stop at record prices, the number of residential properties sold in October across New Zealand increased by 25.0% from the same time last year (from 7,063 to 8,830) – the highest number of properties sold in 53 months (May 2016) and the highest October sales count since October 2006 (14 years).
For New Zealand excluding Auckland, the number of properties sold increased by 14.2% when compared to the same time last year (from 4,982 to 5,690) – the highest number of properties sold since March 2017 (43 months) and the highest October sales volumes since October 2006 (14
years).

“Given the price rises we’ve seen over the past few months, we wouldn’t be surprised if the Reserve Bank goes ahead with its proposal to reinstate LVRs before the 12-month period is up – particularly for investors.”

Bindi Norwell – CEO of The Real Estate Institute of New Zealand

Median Price

Median prices in the Nelson/Marlborough/Tasman regions increased in October 2020 when compared to the same time last year, up 10.5%, 26.8% and 12.9% respectively, with Tasman reaching a median house price of $700,000.

In the region, demand has remained high for good properties with 31.4% of all sales in the $750,000+ bracket, compared to 15.8% in the $750,000+ bracket at the same time last year. Many properties are receiving multi-offers and selling above vendor expectations.

Days to Sell

In October, the median number of days to sell a property nationally decreased 5 days from 34 to 29 when compared to October 2019, the lowest for the month of October in 17 years.

The current Days to Sell of 27 days in Nelson/Marlborough/Tasman is less than the 10-year average for October which is 32 days. There were 9 weeks of inventory in October 2020 which is 4 weeks less than the same time last year.

“This is the first time since records began that we haven’t had a single region with a median number of days to sell a property over 40 days showing how quickly people are moving to secure a property they like in the current market. As important as it is to be ready to move quickly, it’s important that people take time to do their homework before rushing in to purchase a property.”

Bindi Norwell – REINZ CEO

Sale Volume

Only one region, Nelson, saw an annual decrease in sales volumes with the number of properties sold
in October falling by just one property from 102 in October 2019 to 101 this October. But sales count was up 10.7% and 29.3% for Tasman and Marlborough respectively. Tasman saw the highest sales count for an October month in 17 years, with 83 properties sold.

“New Zealand’s housing market is extremely buoyant at the moment, with more than 8,800 properties sold around the country – that’s more than 283 properties sold every day in October. The last time we saw sales volumes of this magnitude was back in May 2016 when the market was very strong, and prices were rising across many parts of the country.“ says Bindi Norwell.

(Source – REINZ, Oct 2020)