As house prices fell throughout 2022, the year ended with seven New Zealand regions in buyers' markets, new data shows.
Realestate.co.nz said following an "interesting" year when the national average asking price trended downwards in response to rising inflation, interest rate hikes, and shifting lending rules, 2022 has been a period of change for the property market.
"There have been a lot of external factors at play this year. Not only have we seen significant economic activity within New Zealand and globally, but we have also been in recovery from the skyrocketing prices we saw during the peak of pandemic restrictions," said realestate.co.nz spokesperson Vanessa Williams.
Buyers' markets emerged nationally and in Hawke's Bay, Taranaki, and Otago last month, while Auckland, Waikato, and Nelson and Bays continued consecutive buyers' market streaks.
Following a brief hiatus, Wellington also returned to a buyers' market in December after favouring property seekers for eight successive months between March and October 2022.
In addition, realestate.co.nz said Manawatū/Whanganui teetered on the edge of a buyers' market at the end of 2022.
Williams said that increasing interest rates have contributed to the creation of buyers' markets.
"In December 2021, the average two-year fixed mortgage rate was 4.73 percent. In November 2022, this was up to 6.75 percent. Money is more expensive than it was 12 months ago, which means there is less credit available to buyers," she said.
"Fewer buyers in the market combined with stock increases around the motu create a perfect storm where supply exceeds demand, and buyers' markets emerge," said Williams.
She added, however, that buyers' markets don't necessarily spell doom and gloom for sellers: "A buyers' market gives buyers and sellers more time to negotiate and do their due diligence. It doesn't automatically mean low prices."
Housing stock up in all regions
All regions saw year-on-year total stock increases during December 2022, and four regions saw stock more than double, realestate.co.nz said. Growing by more than 100 percent was Coromandel (up 175.3 percent), Nelson and Bays (up 147.2 percent), Taranaki (up 118.6 percent), and the central North Island (up 110.3 percent).
National stock levels were also up by 55.3 percent year-on-year.
Williams said those looking for property at summer holiday hotspots have more to choose from than they did a year ago.
"This is especially significant in small regions like the Coromandel. At the end of December 2021, there were just 157 homes for sale in the region. The end of December 2022 had 432 homes on the market," Williams said.
"It's great for buyers as it increases their chances of finding a property that suits their lifestyle."
Record average asking price for Southland
Southland's average asking price hit $547,269 for the first time since records began 15 years ago.
Prices are up 10.6 percent compared to December 2021, and bucking the national trend, Southland has seen prices trend upwards throughout 2022.
The record price high may result from demand exceeding supply, realestate.co.nz said. New listings in the region were down by 39.3 percent compared to the same month last year.
"As in most regions, population growth has slowed in Southland during the last 12 months, so we can't point to migration as a factor in the price growth," Williams said.
"However, with an average asking price of $547,269, just over half of the national average asking price, perhaps Kiwis have recognised the region as a great place to own property."
Nationally, the average asking price increased to $920,422 in December after dipping just below $900,000 in November 2022.
New listings down in almost all regions
Realestate.co.nz said the number of new listings remained low in almost all regions last month compared to December 2021. Year-on-year, only Taranaki and Coromandel saw a rise in new listings, while Gisborne remained static.
"In December 2022, new listings dropped by more than -20 percent nationally and in nine regions. In other words, fewer people put their homes on the market in December 2022 than in December 2021," Williams said.
"There could be many reasons for this; the coming election, nervousness around prices or the fact that finance is more expensive than it was a year ago."
Williams said that while Auckland and parts of Northland and Waikato had just come out of lockdown restrictions in December 2021, this doesn't appear to have skewed the drop to new listings in December 2022.
"Generally, we saw an influx of new listings following lockdown periods, but this was not the case nationally in December 2021. Instead, new listings were at a similar level as the previous December (2020)," she said.
