House prices were up 2.74% y-o-y in Q2 2019
New Zealand’s house prices continue to rise, albeit at a slower pace since the introduction of a regulation banning non-resident foreigners from buying existing homes in the country. Median house prices rose by 2.74% (inflation-adjusted) during the year to Q2 2019, a slowdown from y-o-y rises of 8.76% in the previous quarter and 4.3% a year earlier. In a quarterly basis, real house prices fell slightly by 0.58% in Q2 2019.
Demand and supply are rising
The number of dwellings sold in New Zealand rose by a modest 3.7% y-o-y to 6,118 units in July 2019, according to the Real Estate Institute of New Zealand (REINZ). In Auckland, dwellings sold increased 6.6% y-o-y to 1,894 units over the same period. Nationwide, the number of days-on-market increased by three days to 40 days in July 2019 from a year ago.
The number of properties available for sale in New Zealand increased by 2.6% y-o-y to 21,843 units in July 2019.
Rents, rental yields: Good yields at 5.48%
Apartment costs in Auckland are around $7,209 per sq. m.
|New Zealand: typical city centre apartment buying price, monthly rent (2 BR apartment)|
|Buying price||Rate per month||Yield|
Recent news: For the last five years, NZ economy’s performance has been the strongest since 2007, with growth of 3% in both 2017 and 2018, 4.1% in 2016, 4.2% in 2015 and 3.2% in 2014. The economy is projected to grow further by 2.5% this year and by another 2.9% in 2020.
In August 2019, the Reserve Bank of New Zealand (RBNZ) cut the Official Cash Rate (OCR) by 50 basis points to a historic low of 1.0%, following a 25% basis point rate-cut in May 2019, to buoy the economy.