Fewer listings fail to clear property glut

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Fewer people are selling their homes as uncertainty continues to cloud the New Zealand property sector.

Realestate.co.nz's NZ Property report shows the number of new listings fell for the fifth straight month last month, fuelling talk of a looming property shortage in our biggest city.

Realestate.co.nz's Alistair Helm said just 9804 properties came onto the market last month, the first time in more than a year that the volume of new listings has fallen below 10,000.

Ordinarily the decline would signal a tightening of the market, if it were not for the glut of unsold homes in the provinces and sluggish sales, Helm said.

"In theory that should clear the inventory, but because the sales volumes over the last three or four months have been quiet we haven't been able budge that stock of unsold property."

"Psychologically people are just wary about taking on debt," he said.

REINZ figures from July showed the number of sales dropped to their lowest July on record, down 27 per cent on year ago figures, reinforcing the view that it was a buyers' market.

However Helm said the lack of new listings could create problems for areas like Auckland where the number of unsold homes were closer to the long-term average.

In Auckland inventory edged down to 35.7 weeks, against a long-term average of 38 weeks and the current national average of 38 weeks.

"Auckland could be headed for a looming property shortage if sales were to take off," he said.

"If you have people who have the financial ability to step in and buy, you could get some competitive bidding."

Listing prices nationally edged up to $403,423 during August, from $400,481 during July, but remained below the June figures of $410,058.

Helm said sellers were "waiting out the lull before the active market that traditionally arrives with spring".

"Large inventory of unsold houses is the problem in the market that won't go away, although in the cities we're starting to see that change."

- NZ HERALD ONLINE