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C21
PUBLISHER Century 21 New Zealand Ltd
CONTRIBUTORS Jen Baird Bhethnee Kaur CoreLogic NZ
EDITORIAL ENQUIRIES Century 21 New Zealand +64 9414 6041
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DISCLAIMER
WELCOME TO THE
SUMMER 2024 ISSUE OF
C21 MARKET PULSE
We have in preparing this information used our best endeavours to ensure that the information contained therein is true and accurate, but accept no responsibility and disclaim all liability in respect of any errors, inaccuracies or misstatements contained herein. Prospective buyers and sellers should make their own enquiries to verify the information contained herein. All information contained in the CENTURY 21 New Zealand Ltd website is provided as a convenience to clients. All links to property prices displayed on the website are current at the time of issue, but may change at any time and are subject to availability. For more information on our Privacy Policy please refer to: www.century21.co.nz/disclaimer
Cover image: Angelo Pantazis on Unsplash
C O N T E N T S S U M M E R
PROPERTY MARKET UPDATE
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ASK A C21 AGENT
More positivity as sales and listing numbers
When selling, what can I do to improve my
increase
property’s overall value?
CEO REINZ, Jen Bairds
FINANCE
HOME ORGANISATION
04
The art of home organisation: creating harmony
10 things to know about mortgage debt right now CoreLogic NZ
in your living space
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P R O P E R T Y M A R K E T U P DAT E
MORE POSITIVITY AS SALES AND LISTING NUMBERS INCREASE
BY J E N B A I R D, REINZ CEO
The Real Estate Institute of New Zealand’s (REINZ) November 2023 figures show more sales activity, more listings coming to market, lower days to sell and a sense of more confidence overall (year-on-year). REINZ Chief Executive Jen Baird
month-on-month for November, with
a 17.4% increase month-on-month to
says November continues the trend
a 51.3% increase, followed by Tasman
$399,500 from $340,000.
of slow and steady improvement in
at 32.8% and Wellington at 31.1%.
property market activity now that the
“Local agents are reporting steady
The national median sale price
activity across different buyer groups,
remained largely unchanged
with more competition for buyers’
compared to last month, increasing by
attention in areas where listings have
$1,000 to $790,000. Year-on-year,
increased. With median prices either
We’ve seen steady activity again
there is a slight national decrease
largely unchanged or slightly lower
this month with a solid increase
of 2.0% from $806,000, while New
year-on-year in a number of regions,
in the number of properties sold,
Zealand excluding Auckland is down
for some buyers, now will be the time
up by 15.7% (from 5,550 to 6,422)
by 1.4% to $700,000 from $710,000.
to act.
country is past the election, and we head into more active months in the property cycle.
month-on-month, and up by 12.2% (from 5,724 to 6,422) compared to November 2022. For New Zealand excluding Auckland, the total number of properties sold has followed a similar pattern, increasing by 17.0% month-on-month and increasing by 12.2% year-on-year. Across the regions, the data shows that only three of the sixteen regions
The market is continuing to move a “NOVEMBER HAS BROUGHT THE EXPECTED LIFT IN THE NUMBER OF PROPERTIES COMING TO MARKET AND A SIGNIFICANT INCREASE IN THE NUMBER SOLD - A SIGN OF POSITIVITY RETURNING TO THE MARKET. ”SAYS BAIRD.
little quicker. The national median Days to Sell has remained the same this month at 38 days compared to last month, and decreased year-on-year by three days for New Zealand from 41. Regionally, West Coast again saw a decrease of 22 days, with Nelson close behind with a 17-day decrease in median Days to Sell month-on-month.”
had a decrease in the number of properties sold month-on-month,
Median sale prices are still mixed this
(West Coast -5.6%, Taranaki -2.1%
month with half of the regions having
and Otago -0.3%) and only two had
between 0% and 3.1% increase month-
decreases year-on-year (Nelson
on-month. The remaining regions had
-16.9% and West Coast -2.9%).
a decrease in the median sale price,
Comparatively, Nelson was also the
albeit at less than 4%. West Coast
region with the biggest increase
stood out from the other regions with C21 MARKET PULSE
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At the end of November, the total number of properties available for sale across New Zealand was 28,014, down 1.5% (435 properties) from 28,449 year-on-year, and up 9.4% month‑on‑ month. For New Zealand excluding Auckland, inventory
ANNUAL ME DIAN PRICE CHANGES
-7.9%
-0.8%
NORTHLAND
AUCKLAND
NATIONAL MEDIAN PRICE:
$790,000
BAY OF PLENTY
-3.2%
-2.0%
GISBORNE
-7.7%
TARANAKI
38
-7.1%
-15.2%
WAIKATO
-8.9%
MEDIAN DAYS TO SELL:
-4.9%
-1.1%
MANAWATU / WANGANUI
HAWKE’S BAY
-1.1%
NELSON
-3.2% -4.9%
-4.3%
TASMAN
WELLINGTON
MARLBOROUGH
5.3%
WEST COAST
CANTERBURY
-8.5%
-5.5%
SOUTHLAND
OTAGO Source: REINZ Monthly Property Report 13 December 2023.
Year-on-year numbers remained
a 0.8% increase compared to the
(0.6%) year-on-year from 17,579 to
mixed but we are watching more
previous month. However, when
17,692 and increased 9.8%
signs in the rolling months of an
compared to the same period last
month-on-month.
improving market.”
year, the HPI reflects a 0.2% decline.
Nationally, new listings increased by
“While factors like interest rates
5.2% from 10,185 to 10,712 listings
continue to impact the market, it
year-on-year and increased 12.4%
certainly looks as though buyers and
month-on-month. New Zealand
sellers are heartened by the fact that
excluding Auckland also saw an
the election is over and the Official
increase month-on- month of 12.9%
Cash Rate is stable. Although we will
and year-on-year of 2.5%.
see some slowing over the Christmas
increased marginally by 113 properties
“We’ve seen a large jump in the number of listings coming to market this month compared to last month. Notably, Gisborne with a 75% increase and Manawatu-Whanganui,
period, we anticipate seeing a resurgence of activity from the end of January, as the boost in market positivity helps raise confidence further,” comments Baird.
Wellington, and Nelson all reached
The HPI for New Zealand stood at
increases in the mid-20% range.
3,686 in November 2023, showing
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The average annual growth in the New Zealand HPI over the past five years has been 6.1% per annum. It remains 13.8% below the peak of the market in 2021.
Click here to read the full report
H O ME O R G A N I S AT I O N
THE ART OF HOME ORGANISATION: CREATING HARMONY IN YOUR LIVING SPACE In the hustle and bustle of daily life, maintaining a tidy and organised home can often feel like an elusive goal. However, the benefits of an organised living space extend far beyond just aesthetics. A well-organised home can significantly reduce stress, increase productivity, and create a more harmonious environment for you and your family. Let's explore some practical tips to help you master the art of organising your home.. 1. DECLUTTER WITH PURPOSE
these zones to prevent clutter
5. DIGITAL ORGANISATION
The first step in achieving a
from accumulating.
In today's digital age, organising
well‑organised home is to declutter. Start by assessing each room and identifying items that no longer serve a purpose or bring joy. Whether it's old magazines, clothes you haven't worn in years, or kitchen gadgets gathering dust, be ruthless in your decision-making. Donate, sell, or discard items responsibly to create a clean slate for organising.
2. CREATE FUNCTIONAL ZONES Assign specific functions to different areas of your home. Designate zones for activities such as work, relaxation and meals. This not only helps to streamline your daily routines but also makes it easier to maintain order in the future. Ensure that each item has a designated home within
3. INVEST IN STORAGE SOLUTIONS Maximise your space by investing in smart storage solutions. Utilise storage bins, baskets, and organisers to keep similar items together. Consider multifunctional furniture with built-in storage to
your home extends beyond physical spaces. Take control of your digital life by organising files on your computer, decluttering your inbox and managing digital documents. This not only saves time but also reduces mental clutter.
make the most of limited space.
6. PERSONALISE AND BEAUTIFY
This not only reduces visual clutter
Having an organised home doesn't
but also makes it easier to find and
mean you have to sacrifice personal
access what you need.
touches and style. Incorporate
4. ESTABLISH DAILY ROUTINES Incorporate short daily routines to maintain the organisation of your home. Spend a few minutes each day tidying up common areas, putting items back in their
elements that bring you joy and reflect your personality. Use decorative storage solutions, incorporate plants and display cherished items to create a space that feels inviting and comfortable.
designated places, and addressing
7. INVOLVE THE WHOLE FAMILY
any clutter that may have
Maintaining an organised home
accumulated. Consistency is key to
is a team effort. Involve your
preventing chaos from taking over.
family members in the process by
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assigning age-appropriate tasks and
effort. A well‑organised home
responsibilities. Teaching children
fosters a sense of calm and order,
the importance of organisation
contributing to a more peaceful
early on instils good habits that will
and enjoyable living environment.
benefit them throughout their lives.
Embrace the journey of creating a
Organising your home is not a one-time task but an ongoing process that requires dedication
harmonious space that supports your well-being and enhances your overall quality of life.
and consistency. The rewards, however, are well worth the C21 MARKET PULSE
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ASK A C21 AGENT
WHEN WILL SELLING, WHAT WHAT CAN HAPPEN TOI DO TO IMPROVEAFTER MY PROPERTY PROPERTY’S FREEDOM DAY? OVERALL VALUE? Improving your property's overall value can be achieved by using various strategies and enhancements to the property. Here are some in-depth suggestions that can help maximise your property's appeal and attract potential buyers: 1. ENHANCE CURB APPEAL
3. MODERNISE THE BATHROOM
converting an attic into a loft or
First impressions matter, so
Similarly to the kitchen, upgrading
extra bedroom, or constructing an
improving the exterior of your
the bathrooms can greatly increase
extension. More square footage can
property can have a huge impact.
your property's value. Focus on
significantly increase your property's
Ensure that the landscaping is
replacing worn-out fixtures, such as
value and appeal, particularly for
well-maintained, with trimmed
taps and showerheads, and consider
buyers looking for room to grow.
hedges, a lush lawn, colourful
installing a new vanity, mirror or
flowers and fresh mulch. Repair
lighting fixtures to freshen the look.
or replace any damaged walkways,
Opt for neutral colours and timeless
driveways or fences. Consider
design choices to appeal to a wider
giving the front door a fresh
range of buyers.
but also help buyers save on utility
4. INCREASE NATURAL LIGHT:
efficient windows, insulation or
welcome mat.
Bright, well-lit spaces are highly
appliances. Adding solar panels can
desirable. Maximise natural light
be another impactful choice that can
2. UPGRADE THE KITCHEN
by cleaning windows, removing
attract buyers looking for long-term
The kitchen is often considered the
heavy drapes, and trimming shrubs
savings.
heart of a home. Consider updating
or trees that obstruct light. Consider
outdated features, such as replacing
adding skylights or larger windows
old appliances with energy-efficient
where applicable to create a more
models, installing new countertops,
open and inviting atmosphere.
buyers. Optimise existing storage
5. ADD ADDITIONAL LIVING SPACE
or organisers. Consider adding
If feasible, consider adding extra
additional storage options such as
living space to your property. This
installing closet systems or building
could involve finishing a basement,
a storage shed in the backyard.
coat of paint and updating the hardware or adding a new
refreshing cabinet doors, or adding a tile splashback. These changes can make a significant impact on the overall appeal and value of the property.
C21 MARKET PULSE
6. UPGRADE ENERGY EFFICIENCY Energy-efficient features not only contribute to a healthier environment bills. Consider installing energy-
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7. IMPROVE STORAGE SOLUTIONS Ample storage is crucial for many areas by adding built-in shelves
Image: Josh Hemsley on Unsplash
SECTION HEADER
8. ENSURE PROPER MAINTENANCE Address any necessary repairs or maintenance tasks before listing your property. Fix leaking taps, repair cracked walls or ceilings, replace broken tiles, and address any structural issues. Ensuring your property is in good condition will maximise its appeal and value.
9. UPGRADE TO SMART HOME TECHNOLOGY Incorporating smart home technology can be a significant selling point. Consider installing
devices like a programmable
Remember, every property is
thermostat, smart lighting, or a
unique, and the key to maximising
security system. These features
its value is understanding your
offer convenience, energy
target market and tailoring
efficiency, and enhanced security.
improvements to their preferences.
10. SEEK PROFESSIONAL ADVICE
Click here to find your local
Consult with a local real estate
Century 21 agent today.
agent or home staging professional who can provide insights into current market trends and buyer preferences in your area. They can guide you on specific improvements that would yield the highest return on investment for your property.
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WHAT WILL HAPPEN TO PROPERTY AFTER FREEDOM DAY?
FIND OUT YOUR PROPERTY’S WORTH IN AN INSTANT Access an instant property report now. Click here to begin.
C21.co.nz/property-report/
FINANCE
10 THINGS TO KNOW ABOUT MORTGAGE DEBT RIGHT NOW
BY CORELOGIC NZ
In today's Market Pulse, Chief Property Economist Kelvin Davidson dives into lending activity and shares 10 key insights about mortgage debt across the country. The housing loan market has
owners) borrowed at less than a
FHB loans recently, and less than
been relatively subdued over the
20% deposit. The allowable cap,
8% for investors. Through 2021,
past 12‑18 months, alongside the
or speed limit, for that low deposit
those same figures for investors
downturn in sales volumes and
owner-occupier lending is 15%.
were typically 35-40%. The key
property prices. But there are now signs of a turnaround for those variables, and lending activity is also starting to rise – albeit from a low base. So what’s the current lie of the land and what are key things to keep
3. FIRST HOME BUYERS (FHBS), HOWEVER, ARE CERTAINLY CAPITALISING ON THE SPEED LIMIT. Around one-third of FHBs who got a loan in October did so at low
in mind?
deposit (or high LVR), and they’ve
1. NEW LENDING FLOWS OVER AUGUST-OCTOBER WERE 4% HIGHER THAN A YEAR AGO.
for 70-80% of all owner-occupier
The Reserve Bank figures show gross new lending flows for house purchases, bank switches and loan top-ups over August-October were 4% higher than a year ago, but the total of $16.8bn was still well below the figures for the same period in both 2020 and 2021, of $21.9bn and $22.8bn respectively.
2. LOAN TO VALUE RATIO RULES ARE STILL BITING FAIRLY HARD. Only 0.3% of investors got a loan in October with less than a 35% deposit, and only about 7% of all owner-occupiers (FHBs and existing
fairly consistently been accounting lending at a low deposit.
4. FHBS ALSO TAKE OUT RELATIVELY LARGE LOANS. The average in October was just short of $562,000, versus the investor figure of around $493,000.
5. SO-CALLED ‘RISKY’ LENDING IS NOT MUCH OF A PROBLEM AT PRESENT. Only around 17% of lending in October was interest-only (versus figures of as much as 40% in the past), and loans at debt to income (DTI) ratios of at least seven are also ‘under control’. That DTI bucket has accounted for only about 1% of
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handbrake here is simply high mortgage rates, which naturally limit the amount of debt that can be secured/serviced.
6. INDEED, THE LATEST INDUSTRY‑WIDE FIGURE FOR A ‘SPECIAL’ (HIGH EQUITY) ONE-YEAR FIX WAS ABOUT 7.3% AND THE TWO YEAR RATE IS ROUGHLY 7%. The lows for those rates were 2.2% and 2.6% respectively. Across the stock of existing debt right now, the average mortgage rate is 5.3%, up from the trough of 2.7%, but still well below prevailing market rates
7. TOTAL MORTGAGE DEBT CURRENTLY STANDS AT $354BN, VERSUS AN ESTIMATED VALUE OF OUR PROPERTY STOCK OF $1,585BN. That’s an aggregate LVR of only around 22%, implying there’s a lot equity out there (at least on paper).
Continued over page
Image: Nadzeya Matskevich on Unsplash
Continued from previous
8. EVEN SO, THE MORTGAGE REPRICING PROCESS IS ONGOING AND WILL REMAIN A KEY ISSUE IN 2024. About 54% of current loans are fixed but due to be repriced in the next 12 months, many of which will see a higher mortgage rate. Indeed, recall from #6 that average existing rates are still well below current market rates.
9. AMONGST THE EXISTING LOANS, HOWEVER, AT LEAST NON-PERFORMING MORTGAGES REMAIN VERY LOW, AT LESS THAN 0.5% OF THE VALUE OF DEBT.
10. IT’S ALSO ENCOURAGING THAT MANY EXISTING MORTGAGEHOLDERS ARE AHEAD ON THEIR REPAYMENTS. Recent Westpac data, for example, shows that on their books, about two-thirds of borrowers are at least three months in the black, with a median buffer of nearly $13,000. This pattern is likely to apply to the other banks too. Of course, we also need to acknowledge recent Centrix data showing that there are
Second, however, that reassuring trend of households steadily adjusting to higher mortgage rates may not last forever, especially if we do see some job losses in 2024. The mortgage repricing issue remains a key one to watch. Third, and more generally, the ‘post-COVID’ years have reinforced the key role of credit availability and cost in driving short-run trends in the housing market – the boom in 2020-21 when mortgage rates fell, and then the
around 19,000 mortgage accounts
subsequent downturn as rates rose.
past due – up by 25% from a year
Of course, migration, population
ago, but from a very low base.
changes, and housing supply are vital
So what are the key takeaways
factors in the medium/long term. But
here? First, the labour market has
Our own CoreLogic data also shows
been robust in the past few years,
that mortgagee sales are at low
even though the economy has
levels too, just 41 in Q3 2023 (see
been flirting with recession. That
the second chart below). To be fair,
job security has kept stress in the
no mortgagee sale can be a good
mortgage sector at low levels, even
thing. But at least they’re far lower
though households have had to
than the post-GFC period.
significantly adjust their finances.
due to ‘higher for longer’ mortgage rates, we remain cautious about the potential speed of this emerging ‘upturn’ in house prices. Certainly, high interest rates – combined with low rental yields – are a key hurdle for investors looking to expand or start their portfolios at present.
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