NZ house sales growth slow in August as RBNZ loan limits stifle supply
New Zealand house sales growth slowed in August as the pending limits on low equity home loans kept sellers uncertain as to their impact on what's been a bubbling market.
The number of houses sold in August fell 3.4 percent to 6,548, for an annual gain of 8.5 percent in the same month a year earlier, according to the Real Estate Institute of New Zealand. That's slowed from a peak annual pace of 33 percent in April. The median sale price rose $5,000 to $390,000 in August, and was up 5.5 percent from the same month in 2012.
"Agents report across the country that potential sellers are taking a 'wait and see' attitude in terms of rising prices and what effect the Reserve Bank's new lending policy will have on the market," REINZ chief executive Helen O'Sullivan said in a statement. "This uncertainty in the short term is exacerbating the problem of supply, although there should be a traditional lift in properties for sale as spring takes hold."
Last month, Reserve Bank governor Graeme Wheeler announced restrictions on high loan-to-value ratio mortgage lending, essentially loans with deposits of less than a fifth of a property's value, will come into play from October. The central bank aims to take the sting out of a heating property market that threatens the nation's financial stability, and could spill over into fuelling inflation.
Rising prices in Auckland and Christchurch, the country's two-biggest cities, have underpinned rising house prices as a lack of supply fails to meet increasing demand. Auckland and the Canterbury region accounted for 84 percent of the annual increase in the national median price.
The median house price in Auckland rose 2 percent to $563,000 in August, and was up 11 percent from a year earlier. Sales volumes slipped 2.9 percent to 2,677, though were up 13 percent from August 2012.
The median price in Canterbury/Westland increased 1.4 percent to $365,000 in August, for an annual lift of 5.8 percent. The number of sales rose 1.8 percent to 835 for an annual increase of 12 percent.
The REINZ stratified housing price index, which strips out peaks and troughs in housing information, rose 2.1 percent in August for an annual pace of 9.5 percent. Auckland stratified prices climbed 6.5 percent in August for an annual gain of 18 percent.
The number of days to sell fell to 34 days in August from 35 days in July.