Data released today by the Real Estate Institute of New Zealand (REINZ) shows there were 24 fewer (-1.9%) lifestyle property sales for the three months ended November 2022 than for the three months ended October 2022. Overall, there were 1,273 lifestyle property sales in the three months ended November 2022, compared to 2,028 lifestyle property sales for the three months ended November 2021 (-37.2%), and 1,297 lifestyle property sales for the three months ended October 2022.
7,113 lifestyle properties were sold in the year to November 2022, 3,003 less (-29.7%) than were sold in the year to November 2021. The value of lifestyle properties sold was $8.80 billion for the year to November 2022.
The median price for all lifestyle properties sold in the three months to November 2022 was $1,050,000 — $50,000 more (+5.0%) than the three months ended November 2021. The median price for bareland lifestyle properties sold in the three months to November 2022 was $470,000 — $15,000 less (-3.1%) than the three months ended November 2021. The median price for farmlet lifestyle properties sold in the three months to November 2022 was $1,200,000 and was $50,000 less (-4.0%) than the three months ended November 2021.
Brian Peacocke, Rural Spokesman at REINZ, says: “Sales volumes for the three-month period ending 30 November 2022 indicate a levelling out from the plunge in sales volumes from the heady days of two years ago as noted below:
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3,076 sales for three-month period ending November 2020
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2,028 sales for three-month period ending November 2021
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1,273 sales for three-month period ending November 2022 — a drop of just under 60% over a two-year period.
“Given the relatively close relationship between the lifestyle market and the residential market, it is not surprising that lifestyle sales volumes have softened in tandem with the residential market, as the same pressures apply to both markets.
“The dominant issues are increasing interest rates and stricter criteria being applied by most trading banks.
“Potential borrowers must make a careful assessment of their levels of equity and income, and a determination of how much income is available for debt servicing.
“As interest rates increase the affordability bar adjust. Under such circumstances, it is inevitable the market will falter, which is what is happening now.
“Nevertheless, despite such issues, qualified purchasers are still operating in the marketplace, and quality properties in good locations continue to sell to discerning purchasers — the key issue as always is the price.
Brief summary of movement in the marketplace during the month of November is outlined below:
Northland: sales increased 11.0%; median price increased 11.0 %
Auckland: sales increased 22.8%; median price increased 7.3 %
Waikato: sales decreased 7.0%; median price increased 13.5 %
Bay of Plenty: sales decreased 19.4%; median price increased 4.6 %
Gisborne/Hawke’s Bay: sales increased 17.4%; median price increased 13.5 %
Taranaki: sales maintained at par; median price decreased 13.7 %
Manawatu/Whanganui: sales increased 15.8%; median price increased 30.0 %
Wairarapa/Wellington: sales increased 20.0%; median price increased 5.6%
Nelson/Marlborough: sales minor decrease; median price maintained at par
Canterbury: sales increased 23.5%; median price increased 3.6%
Otago: sales decreased 30.0%; median price maintained at par
Southland: sales maintained at par; median price decreased 25.6%
No regions recorded an increase in sales compared to November 2021, with Taranaki (-6 sales) and Southland (-15 sales) observing the smallest decreases. Canterbury (-150 sales) and Auckland and Waikato (-107 sales) recorded the greatest decreases in sales in the three months to November 2022 compared to the three months to November 2021.
Compared to the three months to October 2022, four regions recorded an increase in sales.
Nine regions saw the median price of lifestyle blocks increase between the three months ending November 2021 and the three months ending November 2022. The most notable examples were in West Coast (+67.3%) and Manawatu/Whanganui (+16.7%) with the greatest decreases in Auckland (-18.9%) and Wellington (-13.7%).
The median number of days to sell for lifestyle properties was eight days more in the three months to November 2022 than in the three months to November 2021, sitting at 53 days. Southland (35 days) recorded the shortest number of days to sell in November 2022. Northland (69 days) recorded the longest number of days to sell.