February saw the number of house sales fall across New Zealand as legislative changes brought in begin to bite.
The number of house sales fell by 9.5 per cent year-on-year when compared to February 2018.
Data from the Real Estate Institute of New Zealand (REINZ) revealed that 5,954 residential properties were sold throughout the country last month compared to the 6,576 sold in February 2018.
The data is even more pronounced in Auckland, where the number of house sales in February fell by 17.9 per cent year-on-year (from 1,654 to 1,358), representing the lowest for a non-January month since October 2010.
It is not known how much of an impact the extra tax introduced on overseas property investors affected the number of house sales.
Bindi Norwell, chief executive at REINZ, said: ‘The lower level of sales volumes compared to the same time last year can be attributed to a number of things – the raft of legislative changes impacting the housing market at the moment, the increasing difficulty in accessing finance (despite a record low OCR and very low mortgage rates from the banks) and vendors’ pricing expectations.’
The drop in residential home sales runs counter to rising house prices across the country. According to REINZ data, even as house sales dropped, median prices for homes across New Zealand increased by 5.7 per cent in February to $560,000, up from $530,000 in February 2018. Median prices for New Zealand excluding Auckland were even stronger, increasing to a record $490,000 – up 8.9 per cent from $450,000 in February last year.
In Auckland, however, median prices returned to the $850,000 mark – down 0.6 per cent on last year’s figure of $855,000, but up 5.6 per cent on January’s median price of $805,000.
Norwell continued: ‘What we’re hearing from salespeople around the country is that vendors and investors are taking a ‘wait and see’ approach to the housing market – much like you would normally see around election time. This is particularly true in relation to the recently announced Capital Gains Tax proposals from the Tax Working Group. Families want to know what aspects of the proposals the Government will look at accept ahead of next year’s election and what impact that will have on them and their family.’