House market already on holiday?
The housing market may already have its bags packed for the Christmas holiday break with agents reporting decreases in sales and a slowdown in requests from vendors for appraisals.
The latest BNZ-REINZ Residential Market Survey found that a net 51 per cent of real estate agents surveyed this month reported fewer people attending open homes. A total of 587 agents who responded to the online survey conducted last week.
Vendors seeking appraisals were also declining, with a net 7.8 per cent of agents reporting they were receiving fewer requests for appraisals.
The number of homes selling under the hammer at auction was also declining, a trend that has been evident since the start of the year.
A net 38.8 per cent of agents reported lower auction clearance rates, with contracts often not becoming unconditional until a day or two after the auction.
Most agents reported upward price pressure although there were significant regional differences and signs the pressure may be easing.
A net 12.5 per cent of agents believed house prices were rising, down from a net 22.8 per cent last month and a net 41 per cent in October.
However, only a net 9 per cent of agents in Auckland and 11 per cent in Canterbury felt prices were rising, compared with more than 20 per cent in the Waikato, Bay of Plenty, Wellington, and Otago.
The mood of the market also appears to favour buyers, with a net 16 per cent of agents reporting that sellers were more motivated to complete a deal than buyers, about the same as last month.
It may also be taking longer to sell a home, with a net 11.5 per cent of agents reporting that fewer of their sales contracts were becoming unconditional.
There has also been a sharp drop in the number of sales to first-home buyers.
In the May survey, agents reported that almost a quarter (24 per cent) of the homes they sold were to first-home buyers, but in this month's survey that had dropped to 15.3 per cent, as the Reserve Bank's loan-to-valuation ratio (LVR) restrictions started to bite.
The survey said it would probably be many months before the market settled down to a new equilibrium following the introduction of the new LVR regime, but there would probably be continuing upward price pressure due to the high number of migrants settling in this country.