Loan restrictions make dent in city house sales
The number of houses selling in Nelson city dropped markedly last month, a reflection of the impact of loan restrictions.
While 103 homes sold in October, that plummeted to 72 last month which was below the same time last year at 88, new Real Estate Institute figures show.
The Reserve Bank introduced loan-to-value restrictions for banks on October 1 which for home buyers meant a 20 per cent deposit was required to qualify for a mortgage.
That had an instant effect for many first home buyers who could not meet the criteria and in Nelson real estate agents reported fewer prospective buyers turning up to some open homes.
However, in Motueka house sales increased from 15 in October to 23 last month, and in Richmond the number rose slightly, from 25 to 27.
The Reserve Bank this week agreed to exempt new home builds from the LVR restrictions.
House prices in Nelson and Richmond rose by 10 per cent or more last month compared to November last year.
The median house price in Nelson city was $335,000 in November last year, $366,000 in October this year and $372,500 last month.
In Richmond it was $418,000 in November last year, dipped to $402,000 in October this year and rose to $460,000 last month.
In Motueka, the median house price was $317,000 in November last year, rose to $395,000 in October this year and fall to $340,000 last month.
The latest figures show it took an average 27 days to sell in Nelson city, 32 in Richmond, 46 in Motueka and 49 in Takaka.
Nationally, 6961 houses sold last month, down 6.6 per cent from November last year.
However, house prices continued to hit new levels, with a national median high of $425,000.
New median price highs were set in Auckland, Canterbury-Westland, Wellington and Waikato-Bay of Plenty, with Auckland leading the way at $620,000.
Prices are now nearly 11 per cent higher than a year ago and 4.3 per cent above the previous record in October.
Institute chief executive Helen O'Sullivan said turnover last month was 2.7 per cent higher than in October, but that was weaker than usual.
She said restrictions on low-equity lending "may well be a driver of the softer sales figures", with changes appearing at the cheaper end of the market.
House sales below $400,000 were down almost 20 per cent compared with November last year.
House sales Nov Oct Nov 2012 Nelson city 72 103 88 Richmond 27 25 25 Motueka 23 15 25
The Nelson Mail