Property metrics

Figures from CoreLogic NZ show 60,859 properties sold in the year to February 2023, the lowest 12-month total since October 1983.

During February alone, about 4100 deals were done. That is the lowest for that month of the year since at least 1981.

The figures are striking and show just how quiet the market really is. Few vendors are in a hurry to sell, given that unemployment remains low. And those buyers who have secured finance know that they can take their time too, with listings abundant and prices falling.

There are also indications that first-home buyers could be beginning to retreat from the market.

That may just be signs of their interest rate limits being reached. Of course, it may also be that they’ve actively pulled back while they wait for prices to fall further.
Either way, their share of purchases edged lower in February so it’s definitely something to watch.

A key part [of the housing market] is the labour market. If employment can stay high, with unemployment only rising because of a larger labour force, this should insulate property values to some degree.

Outright job losses would be a fresh headwind for the housing market.

Nothing is ever certain when it comes to the economy and especially economic forecasts.

The latest weak GDP data and the global banking issues highlight a possibility that the official cash rate won’t rise all the way to 5.5 percent. If mortgage rates start to edge lower, net migration continues to rise, and investors start to see value again, the case would be building for this current house price downturn to find a floor in 2023.