Latest / Making Cents / The NZ Property Market Just Had Its Biggest Change Since 2020

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The NZ Property Market Just Had Its Biggest Change Since 2020 · Making Cents

• 0:00
  The most houses hitting the market this June since 2020, nearly 8,000 properties, a huge number.
• 0:08
  But whether you think this is good news or bad news will really depend on your own money situation.
• 0:15
  Because on the face of it, more listings sounds like good news, more choice, more competition among sellers, maybe even prices easing off.
• 0:25
  But here's the catch.
• 0:27
  It's not that simple.
• 0:28
  Because while listings are surging, prices nationally have barely moved in three and a half years.
• 0:36
  And the impact isn't even.
• 0:37
  It's really different depending on where you are in New Zealand.
• 0:41
  So to make sense of it, I've got Vanessa Williams from realestate Co nz, our resident data queen who knows the story behind the numbers.
• 0:50
  The national average asking price has remained very stable.
• 0:54
  Sellers are really just getting on with it and actually, in my personal opinion, a great market to transact in.
• 1:01
  And what's influencing these changes in the numbers is even more interesting.
• 1:05
  Gosh.
• 1:05
  The Central Otago Lakes district average for this region of 1.67 million, when you think about the national being around 850.
• 1:15
  So welcome to Ask the Experts the part of making sense where people from inside the money world come to give you the inside word on what's going on right now and what that means for your money.
• 1:26
  Making Sense is partnered with realestate Co NZ to get you the info you need in today's market.
• 1:33
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• 1:36
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• 1:37
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• 1:42
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• 2:03
  Welcome in.
• 2:03
  Vanessa.
• 2:04
  Look, the numbers you sent me here are pretty stunning.
• 2:07
  So the biggest listings for June since 2020.
• 2:11
  What's happening there?
• 2:12
  Crazy, isn't it?
• 2:13
  And okay, hi.
• 2:15
  Thank you for having me back again.
• 2:17
  But yeah, we've seen some really interesting metrics in the property market because what I do find quite fascinating is if you just look at the headlines and nothing else, you would think that the property market is actually in
• 2:29
  a real slump, a real dive.
• 2:31
  Things are not good.
• 2:32
  I don't know if I should sell, I don't know if I should buy.
• 2:35
  And actually that's not what we are seeing at Realestate Co NZ with our data.
• 2:40
  So taking a look at listing numbers, so that's Listings coming or homes, I should say, coming onto the market during the month of June, we haven't seen over, I think it's about 7,200 homes coming onto the market since
• 2:52
  2020, as you said, which is Covid times.
• 2:54
  Right.
• 2:55
  When everybody couldn't travel.
• 2:57
  What do we love?
• 2:58
  Travel and property.
• 2:59
  So we couldn't travel.
• 3:01
  So hey, let's all focus on property.
• 3:03
  And that was a really busy market.
• 3:05
  And so you fast forward to now, there's kind of news about the property markets, this and that, and it's not good and it's all kind of negative connotations.
• 3:14
  But, you know, sellers are really just getting on with it.
• 3:18
  And that's actually great to see because quite often in an election year, you know, we do know that with big financial decisions, which is very fair, any uncertainty and we are a little bit more hesitant, you do start
• 3:30
  to think, I don't know what to do.
• 3:32
  But actually there's a whole bunch of Kiwis out there who are just getting on with it.
• 3:35
  And that's really great to see.
• 3:37
  I also, I mean, this is very much a my gut feel, sort of, sort of perspective on it.
• 3:42
  I also wonder if things have been stagnant for a little while now.
• 3:46
  People are hitting a tipping point where they're like, well, I've got a life to live, I've got decisions to make.
• 3:51
  I just kind of got to move, right?
• 3:52
  Absolutely.
• 3:53
  Because if you are to rewind three and a half years ago when the property market stopped moving in terms of price, that's a long time in somebody's life.
• 4:02
  Three and a half years, massive.
• 4:03
  And depending on where you're at, whether you are at moving out of home stage to family stage, to enjoying a free house stage or thinking about downsizing, three and a half years is a long time in all of
• 4:15
  those stages.
• 4:16
  And I think you're absolutely right.
• 4:18
  At some point you've got to stop looking at the market minute detail by minute detail and go, actually, what is just right for me and maybe it's just time I moved and, you know, I got on with what
• 4:31
  I want to get on with.
• 4:31
  And I think that's what we're seeing.
• 4:32
  A lot of interesting though, because I would think with such a big influx of listings that it would move prices as well one way or another, and yet not really the case, right?
• 4:43
  Yeah.
• 4:44
  And that has probably been the most interesting part for me because I have seen not only new listings, so that's the healthy level of new stock coming onto the market every month.
• 4:53
  Move.
• 4:54
  But I'VE also started to see the total pool of homes available, so the total stock also grow with it.
• 5:01
  So coming out the back of COVID at the absolute bottom of the market, which was August 2021, 12,250 homes right across the Motu for every New Zealand.
• 5:12
  With 5 million people in New Zealand, only 12,250 homes available for them.
• 5:16
  It has grown since then to up around 36,37,000 homes available for Kiwis to peruse.
• 5:23
  So we've started to see that pool really grow.
• 5:26
  And what you would think is typically in the laws of economics is that when supply increases and demand either stays the same or increases, you do start to see prices drop back.
• 5:37
  But actually for three and a half years now, the national average asking price has remained very stable.
• 5:44
  It's sort of fluctuated between about 840 and 890, has sort of been that sweet spot, but it really hasn't moved outside of that sort of 50 grand band for well over three and a half years.
• 5:57
  So, you know, that's very much a stable market and actually in my personal opinion, a great market to transact in.
• 6:03
  Well, it gives you a bit more breathing space.
• 6:05
  Right.
• 6:06
  Which is quite nice.
• 6:07
  You mentioned there though, the national price and it is quite interesting how different things can be around the country.
• 6:14
  Where's our peak?
• 6:15
  Where's our pit?
• 6:16
  Gosh.
• 6:16
  The Central Otago Lakes District, Queenstown, Wanaka.
• 6:20
  You are just in a little microcosm of your own.
• 6:23
  It feels like they were completely immune to any economic shocks.
• 6:27
  The OCR and interest rates had no effect on that market.
• 6:31
  It just seems to keep growing and growing and growing both in the for sale and for rent markets.
• 6:38
  So in June we saw it hit another average asking price.
• 6:42
  I'm just going to say that again, average for this region of 1.67 million.
• 6:49
  When you think about the national being around 850, the Central Otago lakes area at 1.67.
• 6:56
  Wow.
• 6:56
  And the average weekly rent in that area as well is about $900 a week.
• 7:02
  So it's almost $300 a week more than our national average there, which is around $630 a week.
• 7:09
  We see a lot of international interest in that market.
• 7:12
  And so when you have international interest, you have international money, which typically, you know, when you think about the New Zealand dollar, it's been very favourable if you have international money coming in.
• 7:22
  And of course it's almost like a little bit of the Hamptons of New Zealand, you know, a little bit.
• 7:26
  It sort of seems to be, you know, you do typically have to perhaps not be as, or a little bit immune to perhaps some of the economic shocks that probably most New Zealanders do have to take into account
• 7:38
  when they are making their financial decisions.
• 7:40
  So that's been definitely the peak of the market and a peak region there and then.
• 7:45
  Interesting.
• 7:45
  If you are looking for more cost effective homes in New Zealand, you're looking around Southland or the West Coast, a little bit of middle of New Zealand there, sort of Central North Island.
• 7:54
  You know, they sort of sit below the average asking price perhaps in Gisborne areas there.
• 8:00
  But you know, there's plenty of opportunities in every market.
• 8:03
  You know, I do say that and, you know, I was listening to something the other day where the managing director of Simplicity was talking about going down and building a whole bunch of new stock in the Central Otago
• 8:15
  Lakes district to really help alleviate some of that pressure.
• 8:19
  Because of course it's quite hard to build down there.
• 8:21
  But if you can get someone who's going to do it at scale, it becomes a lot more achievable for people to sort of, you know, buy and rent down there.
• 8:28
  So, you know, there are certainly people who are looking into these markets.
• 8:31
  But yeah, we certainly have a broad spectrum right across the Mutu here in Aotearoa.
• 8:36
  I know what I always come back to is the idea of we don't have a property market in New Zealand.
• 8:42
  We have property markets because they do behave so differently in different parts of the country, right?
• 8:49
  Absolutely.
• 8:50
  And look, it really differs on the lifestyle that you get there.
• 8:54
  So, you know, you look around the edge of New Zealand and some of those, even a couple of streets can make a million dollars difference.
• 9:00
  Right.
• 9:01
  You know, you think about beachfront in some areas, you go two streets back, you save yourself a million dollars.
• 9:06
  It's amazing with like a three minute walk to the beach maybe, you know, so.
• 9:10
  And that in itself is fascinating to kind of see, you know, we're very much lifestyle humans here in New Zealand, you know, and a lot of people globally come here because you can literally go skiing in the morning,
• 9:22
  drive for a few hours and go surfing in the afternoon.
• 9:25
  Like, I mean, how many places in the world can you do that?
• 9:27
  Right?
• 9:28
  It's phenomenal.
• 9:29
  If you really wanted to round it off with like a, you know, a trek overnight, you really could do the film Three in a day.
• 9:36
  Absolutely.
• 9:36
  You know, we just have that real privilege here in New Zealand.
• 9:39
  And then of course, because of this dispersed nature of how we live and how we kind of own this space, it happens with our properties.
• 9:46
  As well, you know, we have small, tiny little chalets in the middle of the snowy season, you know, and little tiny batches that, you know, we all pitch a hundred tents around and, and then we've got mansions just
• 9:58
  a couple of doors down the road, you know, and it's, I think it really talks to who we are as Kiwis and the DNA that we have and how our property market represents that DNA of, you know, the
• 10:09
  wonderfulness and diversity that we have as Kiwis.
• 10:14
  If you're looking for property, start with Realestate Co nz, New Zealand's longest standing property site.
• 10:21
  They've been dedicated exclusively to property since 1996.
• 10:26
  That's even before Google.
• 10:28
  Whether you're buying or renting, no other property site gives you as much information.
• 10:34
  The Market Insights feature lets you view the median asking, sale and rental prices in a suburb for over 1, 3 or even 10 years.
• 10:43
  Want to know what a property is worth?
• 10:45
  The estimated sale price range uses the latest sales figures from the real estate industry.
• 10:52
  Scroll to the bottom of a property listing to discover what it sold for in the past, the council valuation and what you can expect to pay for it even before you view it.
• 11:02
  Become the property expert, download the realestate Co NZ app and make informed decisions fast.
• 11:10
  I think when we zoom out a little bit and look at some of those big trends, you found more listings flooding on prices staying somewhat the same.
• 11:18
  Depending on where you are, what do you think of the big underlying causes or the big underlying impacts on our property market at the moment?
• 11:27
  The two big ones would be the OCR changing.
• 11:30
  I mean that's the first time since sort of COVID times that it's gone back up, gone from 2.25 to 2.5.
• 11:37
  And therefore that translates into our retail banks who are reviewing their interest rates which either directly affects us as perhaps a looking to be first home buyer who's got a little nest egg there that will be good for
• 11:48
  you because you'll be getting more interest on your money.
• 11:50
  So we quite often talk about mortgages and the negative effects of an interest rate increase on mortgages.
• 11:57
  But I do like to remind ourselves that there are first home buyers who actually love an interest rate increase and actually works really well for their kind of financial goals.
• 12:05
  However, if you do have a mortgage and depending on when your mortgage comes up, you might see that shift a little bit.
• 12:11
  So that would be one that I would certainly keep an eye on and as a reminder that gets reviewed every six weeks.
• 12:17
  So if you are interested in keeping a bit of tabs on that.
• 12:19
  You can have a look on the Reserve bank website.
• 12:21
  They'll tell you when the next one's coming up.
• 12:24
  The other thing I would say is this back and forth around the global geopolitical landscape as well and kind of what's happening there.
• 12:31
  And I think if you roll both of those up, what is having the biggest impact is uncertainty.
• 12:37
  And understandably so, because when you're making the biggest transaction of your life you would like, and I know we won't go too much into it because we want as much certainty as we can have, but we can't have
• 12:49
  certainty.
• 12:50
  But when you do roll it up, that is what I do think is what's hindering people to make that decision.
• 12:56
  Yeah, I think those are spot on in terms of like the big impacts people.
• 12:59
  I mean uncertainty is the absolute theme of 2026, unfortunately.
• 13:03
  And it does make people cautious, understandably so.
• 13:06
  So if someone is a seller and they're hearing us talk about all this stock flooding onto the market and they're a bit like, ah, how do I stand out in this sort of market?
• 13:15
  Anything you'd say to them there?
• 13:17
  Absolutely.
• 13:18
  So well priced properties are still absolutely selling.
• 13:21
  If you are priced for the market, you will get sold.
• 13:25
  I would also say to them, really think about your marketing strategy because just have a look at what's in your neighborhood and most of the time people try to skimp and save on marketing.
• 13:38
  They think, oh, do I have to spend seven grand?
• 13:40
  Could I spend six grand?
• 13:42
  And think what's my house worth?
• 13:44
  What is six or seven grand as a percentage of that house?
• 13:48
  And have an honest conversation with your real estate agent.
• 13:51
  This is what you are investing in when you're working with a real estate agent is for them to really market your property to create demand and achieve house price maximization and negotiate you a really good deal.
• 14:03
  That is what that fee is generating for you.
• 14:06
  And so have a really good conversation with a real estate agent to go, if I do spend that extra thousand dollars, what do you think that could get me at the other end?
• 14:15
  Because you want to be creating not just one buyer, you want a couple of buyers.
• 14:20
  You want people to be seeing the value in your home and then working towards getting a resolution with you.
• 14:27
  Right.
• 14:28
  And that can't happen if you are trying to sell a secret.
• 14:32
  If you're squabbling over a thousand dollars at the beginning, you're probably perhaps missing out on tens of thousands at the.
• 14:37
  Other end of it or hundred percent.
• 14:39
  I mean when I think about the first home That I bought.
• 14:43
  We got a really good deal because the photos were terrible and nobody showed up.
• 14:49
  And then they actually, you know, partway through, upgraded their marketing.
• 14:53
  We'd already got an offer on by then.
• 14:54
  And we snuck in with a really good offer because they cheaped out, frankly, on the photos.
• 15:01
  Worked really well for me as a buyer.
• 15:02
  I sometimes still think about that seller and feel like a bit bad, but I guess every man for themselves on this thing.
• 15:08
  Totally agree.
• 15:09
  And I have the exact same experience.
• 15:11
  We were buying in a busier market.
• 15:12
  I wasn't really that keen to buy personally.
• 15:15
  No matter how much data I've got under my little fingertips, I still don't like buying in a busy market.
• 15:20
  And it was just so that I pretty much had to just get on with it because we were at that life stage.
• 15:25
  We needed a new house, et cetera, et cetera.
• 15:27
  And we just got in.
• 15:29
  Nobody turned up at the open homes.
• 15:30
  This particular couple who were in the house before us did not want to invest in marketing.
• 15:35
  And so we got got it with very.
• 15:39
  There was no contestants and you know, again, great for us as a buyer.
• 15:43
  But I think, my goodness, there was hundreds of thousands of dollars in this case left on the table.
• 15:49
  There really was.
• 15:50
  You know, as someone who knew what my budget was, there were hundreds of thousands and there were people up the road viewing a very similar house that could have been.
• 15:59
  You got even five in there, even if I was competing with someone else.
• 16:02
  So I do really encourage people to not see marketing as a cost, to see it as an investment around creating house price maximization.
• 16:11
  Yeah, I do think, unfortunately, that is really accurate.
• 16:13
  As much as I am someone who loves not spending money, there are times when you need to.
• 16:18
  Now, if someone is buying, great problem to have, but a lot of options can be overwhelming.
• 16:25
  Sifting through them all, is there anything to help people sort of sift well and strategically without hitting that overwhelm?
• 16:31
  Yeah, it is that.
• 16:32
  You're right, it is quite an overwhelm.
• 16:34
  But the benefit of homes is that they're depending on where you're looking.
• 16:39
  They're all actually quite unique.
• 16:41
  So they will achieve different things for you when you walk in.
• 16:45
  And it could be thinking about, as we said, where is your family at now?
• 16:50
  Where will it be in five years?
• 16:51
  Perhaps, you know, if you've got three that are pretty similar, well, what's going to work now?
• 16:55
  But what actually might work a little bit more into the future?
• 16:58
  You can be a bit more fussy.
• 16:59
  You know, that is such a privilege to be a little Bit more fussy to go.
• 17:03
  Actually, that third toilet, that is the game changer for us.
• 17:06
  If you get yourself feeling overwhelmed, I would say take a step back, take a deep breath and go back to your list.
• 17:13
  What are we buying for?
• 17:15
  What do we want?
• 17:16
  What are our non negotiables and does this house achieve those for us?
• 17:22
  I mean, I am going to say this, I don't think I've said this on this podcast before, but I will say buyers are liars too.
• 17:29
  Which is one of my most favorite things to say.
• 17:32
  I have a friend's dad who's like, right, I want to do a rapper.
• 17:36
  I am not having a heat pump.
• 17:38
  I want an open fire and I want nowhere near a main road.
• 17:41
  I want to be quiet.
• 17:41
  I'm in my 70s now.
• 17:43
  This is the type of lifestyle I will lead.
• 17:46
  Okay, what did he buy?
• 17:48
  New build heat pump right next to a main road.
• 17:51
  Oh, but you know, and he was explaining to me about why this was the house for him.
• 17:56
  So I say this in jest because I think overwhelm can be tough.
• 18:00
  And I do mean go back to your list.
• 18:02
  But also if you walk in that door and fall in love with this place and hey, it doesn't tick some things off your list, but it can see you through this, or it can help you with extra income
• 18:12
  here or that third toilet just turns out to be non negotiable, even though you had it on your negotiating list.
• 18:18
  You know, don't beat yourself up about it too.
• 18:20
  Cause I do think, you know, we have got to make smart financial decisions.
• 18:24
  Of course.
• 18:25
  But you still have to go home to this house every single night if you're buying to live in.
• 18:30
  And so there's gotta be a little bit of heart in there as well.
• 18:32
  You wanna walk in and be so happy that you're there.
• 18:35
  So when you open up your banking app, it's not quite as bad.
• 18:40
  You're still gonna flinch.
• 18:41
  Maybe you flinch and then smile.
• 18:42
  Yeah, exactly.
• 18:43
  Yeah, you've gotta be happy with that decision.
• 18:45
  So, yeah, be go back to your list if you're feeling overwhelmed.
• 18:48
  But it's okay to be a liar buyer too.
• 18:51
  I love that so much.
• 18:53
  I'm going to.
• 18:53
  I've definitely had times that.
• 18:55
  That's a whole nother podcast.
• 18:56
  I've definitely had times where I've lied.
• 18:58
  Yeah, I think we all get those times.
• 19:00
  Oh, so good.
• 19:01
  Hey, thank you so much.
• 19:02
  Vanessa Williams Realestate Co NZ now this was a really great one.
• 19:07
  Taking the temperature of the property market right now because there's a lot going on.
• 19:11
  If you want more like this, let us know and we can also deep dive into your questions about what is going on.
• 19:18
  Ask@francescook.co.nz until next time, have a great day.
• 19:25
  This podcast can only give you general information about how things work in most situations.
• 19:30
  It's not individual financial advice.
• 19:33
  If you're after that, a financial advisor.
• 19:35
  Is always the best bet.