New Zealand's house prices were up 8.76% y-o-y in Q1 2019
New Zealand’s housing market is strengthening again, despite the introduction of a new regulation that bans non-resident foreigners from buying existing homes in the country. Median house prices rose by 8.76% (inflation-adjusted) during the year to Q1 2019, in contrast to a y-o-y decline of 3.37% in the prior year. In a quarterly basis, house prices increased 4.36% in Q1 2019.
Demand remains down; supply rising
The number of dwellings sold in New Zealand dropped 11.5% y-o-y to 5,800 units in April 2019 – the lowest sales volume for the month of April in five years, according to the Real Estate Institute of New Zealand (REINZ). In Auckland, dwellings sold fell by 16.3% y-o-y to 1,608 units over the same period. Nationwide, the number of days-on-market rose by one day to 37 days in April 2019 from a year ago.
The number of properties available for sale in New Zealand increased by 6% y-o-y to 27,858 units in April 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 (120 sq. m) | |||
| Buying price | Rate per month | Yield | |
| Auckland | $412,571 | $1,885 | 5.48% |
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 May 2019, the Reserve Bank of New Zealand (RBNZ) cut the Official Cash Rate (OCR) by 25 basis points to a historic low of 1.5%, the first rate cut since November 2016, in an effort to buoy the economy and promote sustainable employment.
