So does demand, while supply increases
The national average asking price has plunged by more than $100,000 over the past year, the latest Trade Me Property Price Index showed.
The latest figures showed the average asking price was $866,000 in March, down from $971,450 in the same period last year – the largest annual decline on record, and the fourth consecutive month the price has dropped.
“When we take a look across the motu, the drops were particularly apparent in the regions which have had the biggest rises over the past few years,” said Gavin Lloyd (pictured above), Trade Me Property sales director.
Te Whanganui-a-Tara had $128,000 (-13%) knocked off its average asking price, while Tāmaki Makaurau’s plunged by $164,000 (-13%).
“The Wellington and Auckland property markets have been running red-hot post the first COVID lockdown in 2020, so it’s unsurprising that these regions have seen the sharpest drops,” Lloyd said.
The March figures also showed large chunks knocked off from the Hawke’s Bay, Bay of Plenty, Manawatū/ Whanganui, and Waikato’s asking prices when compared with March 2022.
Bay of Plenty fell by $110,000 (-11%) to $883,000, Hawke’s Bay dipped by $73,000 (-9%) to $763,000, Manawatū/ Whanganui fell $55,000 (-9%) to $595,000, and Waikato slipped $51,000 (-6%) to $826,000.
“We are still seeing a market that’s correcting itself after the huge gains made in the past few years,” Lloyd said. “The national average has dialled back to similar levels we saw at the end of 2021, and with the OCR rising yet again, we expect these drops should continue for a little bit longer.
“There’s even more good news for buyers. Not only did prices fall in March, so too did demand (down 12% year-on-year) while supply saw an increase (up 7% year-on-year). When there are more options to choose between and less competition looking at properties, those in the market to buy have greater negotiating power.”
Some smaller regions bucked the trend, however, with Marlborough (+1%), Otago (+2%), and the West Coast (+3%) seeing an increase in their average asking prices.
Lloyd noted an anomaly in the mix of figures – a sharp rise in the average asking price of Christchurch apartments.
“In the past year, the price for an Ōtautahi apartment rose $95,000 (+14%) to $664,000,” he said. “While this is a substantial jump, if we look back over the past couple of years, Christchurch saw the lowest gains of any main centre.
“We are changing the ways we live our lives. Kiwis want smaller places with less maintenance, and we’re living our lives quite differently to how they did a generation ago – and an apartment is an attractive choice for a lot of people now. Christchurch is just catching up to the rest of us.”
So, what do these figures mean?
“We are seeing a lot of shifts in the property market, not just the average asking price, but also how properties are being marketed and sold,” Lloyd said.
“In a hot market, there tends to be less price transparency, which means a lot more auctions. However, today we are entering a phase where properties are spending longer on the market, people are taking their time to make considered purchases and want more information up front. This means price-transparent sale methods like ‘enquiries over’ or ‘price by negotiation’ are making their way back onto the listings.”
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