What lockdown? House price index surges 31.1%

Last month’s covid lockdowns cut the number of monthly house sales by more than a quarter compared to last August, but did little to dampen prices, which shot up by almost a third.

Real Estate Institute of New Zealand data for the month showed the number of residential property sales declined by 26.5% across the country in August, from 7,828 to 5,753, but the house price index climbed 31.1% for the month.

Outside Auckland, the index climbed 33.8% from a year earlier, the biggest annual jump since the series began in 2003. 

The median house price increased by 25.5% to hit $850,000 in August, led by Auckland where the median house price was $1.2 million, a 26.4% increase on the $949,500 median of August 2020.

Institute chief executive Jen Baird said the continued confidence in the market is in stark contrast to the 2020 lockdown cycle, and largely reflected ongoing excess demand over supply.

Nine of the country’s 12 regions hit record price points, while Auckland’s median price growth was underpinned by new records across Rodney district, Manukau city, Waitakere city, Franklin district and Papakura.

Confident buying

Baird said the “ability and confidence” of people to buy and sell property within the alert level restrictions reflects greater comfort with digital solutions for much of the process.

That differs from region to region, with areas that have been at higher alert levels more often, having had a “lower impact on the number of properties sold”, she said.

Data from realestate.co.nz shows the total number of properties available declined by 31.9% in August to 12,249, some 5,725 fewer than August last year and the smallest inventory on record for any month.

“Although we normally experience a lift in listings in spring, this has been delayed by lockdown as vendors are generally opting to prepare their properties now to launch at a lower alert level,” Baird said. 

Last month it took a median of 30 days to sell a property across NZ, which is three days down on last August and the lowest time to sell a property in five years.

However, Baird said she expects that figure to increase in the coming month on the impact of lockdown and delayed sales.