New Zealand Home Sales Reach Six Year High

New Zealand Home Sales Reach Six Year High

Residential News » Asia Pacific Residential News Edition | By Francys Vallecillo | May 13, 2013 10:47 AM ET

Homes sales in New Zealand increased 25 percent in April from the year before, reaching a six year high, according to the latest data from the Real Estate Institute of New Zealand. 

There were 7,104 homes sold in April, an increase from 1,428 sales a year earlier, but a 13 percent decrease from the prior month. 

Sales were slightly stronger than expected at this time of year with April sales showing gains in prices and sales of mid-level homes, according to REINZ chief executive Helen O'Sullivan.   "Several regions appear to be benefiting from the tail-wind generated by the strength of house prices in Auckland and Christchurch," Ms. O'Sullivan said.  

All regions except one reported an increase in sales volume from the year before with Manawatu/Wanganui showing an increase of 36.5 percent, followed by Taranaki with 36.2 percent and Nelson/Marlborough with 34.2 percent.  

The national median sales price decreased 2.4 percent to $390,500 in April from the prior month. However, the figure is still up 7 percent from the prior year.  "Auckland and Canterbury remain the two regions driving the national median price, a point recognized by the Reserve Bank," Ms. O'Sullivan said in a statement.  

In its stability report, The Reserve Bank said it is considering "limits on high loan-to-value home mortgages," which could negatively impact the country's financial stability, according to the New Zealand Herald.  

In Auckland, property values have increased 12 percent to $628,205 in the past year, according to the state valuer, Quotable Value. The median sales price for the city fell to $555,000 in April from $562,000 a month prior, but increased from $490,000 the year before. 

New Zealand agents are seeing increased activity from Asian home buyers after property taxes and regulations have impacted the Hong Kong and Singapore markets. 

"Our apartment group for example is now regularly hosting families coming down to Auckland from Southeast Asia with the sole intention of buying CBD units for their children to live in while they attend university here," Bayleys Real Estate director David Bayley told the Herald.

As U.S. and European markets are still seen as unstable, international interest is growing for the New Zealand market.

"For many Singaporean and Hong Kong investors, they're back looking at New Zealand, which is a location that may well have fallen off their portfolio over the past few years," Mr. Barley said.

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