Property: House sales sink to 10-year low

Photo / Paul Estcourt

Property sales have sunk to their lowest September level in at least a decade, dragged down by a lack of activity in the Christchurch property market.

The REINZ monthly housing price index fell 0.3 per cent during September, and 1.3 per cent compared to the same time last year.

REINZ said 4323 residential properties sold during September, less than half the number of properties sold in September 2006, when the market was at the height of the property boom, the Real Estate Institute said.

However sales last month had shown a slight improvement when compared to the August figure of 4287, REINZ said.

The Canterbury earthquake continued to knock sales with just 396 houses sold in Canterbury/Westland during September, less than half of that recorded for the same month last year.

It is also down 227 sales, or 36 per cent, on the previous month.

In Christchurch city 237 sales were recorded during September, down from 416 in August, while in North Canterbury just four houses were sold, down from 16 in August.

The Canterbury/Westland region typically accounts for 15 per cent of nationwide sales.

Excluding the Canterbury/Westland region, nationwide sales fell by 3.2 per cent.

Realestate.co.nz's chief executive Alistair Helm said the results "bear witness to the fact that the real estate market across the Canterbury region is struggling".

However the results were not unexpected given the catastrophic impact of the earthquake, he said in a blog.

The company's September property report showed just 1211 new listings were added in Canterbury last month, down a seasonally adjusted 19 per cent from August.

"Half way through October the picture is looking very similar with new listings still down," he said.

Meanwhile the median sales price in Auckland bounced back to $450,000 last month, after dropping to $445,000 in August, according to REINZ.

Sales were up to 1690 in Auckland during the month, from 1487 houses sold during August.

REINZ spokesperson Bryan Thompson said sales remained subdued across the country.

Some of this could be attributed to uncertainty over the increase in GST and tax cuts, and "the shocking spring weather we have been experiencing", he said.

"We would expect to see a pick up in the market in coming months as warmer spring and summer weather generally brings an influx on new property listings onto the market providing more choice for buyers."

The national median number of days to sell remained steady at 43 for September, the same as the previous month but still 10 days longer than the 33 days recorded in September 2009.

The total value of residential sales in September, including sections, held steady at $1.86 billion.

The breakdown of the values of the properties sold is 156 for $1 million plus, 505 between $600,000 and $999,999, 1080 between $400,000 and $599,999 and 2582 for under $400,000.

Meanwhile changes in median prices varied, with three regions recording increases of up to 14.81 per cent to falls of up to 4.77 per cent in eight other regions when compared with the same month last year.

ANZ economist Mark Smith said the latest REINZ figures suggested a lack of optimism in the housing market.

An apparent slowing in the economy over the last few months was likely to instil greater caution in buyers, he said.

"Although fixed-term mortgage rates have fallen considerably since the start of the year, this does not appear to have an appreciable impact on the housing market as yet, with variable rate mortgages still the best game in town," he said.

- NZ HERALD ONLINE