Property asking prices drop in 10 of 19 regions

The national average asking price for properties has moved up another notch, but prices in ten out of 19 regions dropped month-on-month, new data shows. May figures show the national average asking price reached a new high of $841,816, up from $838,290 in April - an annual increase of 15.3 percent.

Four regions - Auckland, Taranaki, Nelson & Bays and Otago - set a 14-year record for annual average asking price increases. Auckland reached $1.11 million, up 16.4 percent year-on-year, an annual dollar value increase of $157,642.

But while asking prices in every region have gone up year-on-year, month-on-month (April to May) prices in ten regions went backwards.

The biggest drop was in the West Coast, where the average asking price dropped 7.9 percent, to $331,025. Price drops between 0.7 percent and 3.6 percent were recorded in Wellington, Wairarapa, Manawatu/Whanganui, Northland, Southland, Bay of Plenty, Marlborough, Hawkes Bay and Coromandel. spokesperson Vanessa Williams said although the nationwide average asking price was higher in May than in April, there are early signs market activity is starting to pull back.

"For the past 12 months, we've seen continual month-on-month and year-on-year growth in average asking prices and last month and this month [April and May] we saw that in more than half (10 of the 19) regions they had gone backwards," Williams said.

No region showed three months of consistent average asking price drops, therefore it's too early to tell if prices are starting to trend downwards.

But feedback from real estate agents across different centres indicates less properties sold under the hammer. This didn't necessarily mean they weren't selling, but that fewer buyers were putting their hand up and more negotiation was taking place.

"We're also seeing less people going through open homes - they're still very busy but not as the 40, 50, 60, 80 groups we used to see and there are less bidders in the auction rooms," Williams added.

"There are pockets of New Zealand that are still going very strong… but there certainly is a cooling across the nation."

Over the May month, 8760 listings were added to - 5.2 percent more than the same time last year.  But said coming out of COVID-19 lockdown, listings in May 2020 were lower than a typical May month of around 9500 new listings.

Housing stock, the total pool of homes available for sale on the last day of the month, was lower year-on-year in every region apart from Gisborne. At the end of May, there were 14,883 houses available to buy nationwide - 28.9 percent less than the same time last year.

Where listings are up but stock is down, this indicates properties are going out the door quickly. In other words, demand is outstripping supply.

"Stock has steadily been decreasing over the last decade, and at this point, it would take a flood of properties coming onto the market to reverse that trend," Williams said.

Latest Statistics NZ figures show 42,848 new homes were consented over the year to April 2021, up 15 percent year-on-year. Low stock is at odds with the recent construction boom, indicating pressures around resources, including people, and materials.

Mike Craig, chairperson of New Zealand Certified Builders, said supply is still an issue and product delays are slowing the process down.

"I have jobs that were due to start in October that have now been pushed out to February and I've been hearing similar stories across the industry," Craig said. March 2021 figures show 14 out of 19 regions hit record high average asking prices. By comparison, following the Government housing announcement, May figures show prices in 10 regions went backwards.

"Perhaps now we're starting to see the shift in the market… we'll follow the trend to see if we start to see a cooling in prices from here," Williams said.

The website lists properties for sale through real estate agents in New Zealand. Online listings are allocated a price-range, which users can search. The average asking price is calculated from the price indicated on the listing, divided by the total number of properties.

Property asking prices drop in 10 of 19 regions
Property average asking prices May 2021 compared to April 2021
Property average asking prices May 2021 compared to April 2021 Photo credit: Supplied/