Level 4 lockdown significantly impacts residential sales volumes, but prices hold.
The number of properties sold in April across New Zealand decreased by -78.5% from the same time last year – from 6,082 to 1,305 – as the level 4 lockdown made it very difficult for property sales to occur, according to the latest data from the Real Estate Institute of New Zealand (REINZ), source of the most complete and accurate real estate data in New Zealand.
For New Zealand excluding Auckland, the number of properties sold decreased by -82.4% when compared to the same time last year (from 4,357 to 767).
In Auckland, the number of properties sold in April decreased by -68.8% year-on-year (from 1,725 to 538).
Unsurprisingly, there were no regions with increases in sales volumes during April. However, the West Coast was the only region not to experience a record low during April.
Regions with the largest decrease in annual sales volumes during April were:
- Southland: -92.1% (from 140 to 11 – 129 fewer houses)
- Nelson: -91.6% (from 83 to 7 – 76 fewer houses)
- Manawatu/Wanganui: -87.2% (from 384 to 49 – 335fewer houses)
- Gisborne: -86.6% (from 67 to 9 – 58 fewer houses).Bindi Norwell, Chief Executive at REINZ says: “The number of properties sold across the country decreased by 78.5% when compared to the same time last year which is not entirely surprising given that for the first 27 days of the month the entire country was in complete lockdown and sales could only take place via contactless methods such as online/phone auctions or using digital technology such as FlexiSign.
“Of the 1,305 properties sold across New Zealand, about half were sold in the first 10 days of lockdown (656 properties), followed by just 272 between 11-20 April which included Easter, and then an uplift in the last
10 days of the month with 377 properties sold,” says Norwell.
“What did surprise us, was that April was not the lowest monthly sales count on record for the West Coast. There were a few months in the 1990s where the region had less than the 9 sales experienced in April,” points out Norwell.
“The Auckland region appeared to be the least impacted by COVID-19 when it came to sales volumes, with a 68.8% drop in the number of properties sold. Most of the sales occurred in Auckland City (172,) followed by North Shore City (102) and Manukau City (92). On the flipside, Southland was the most impacted with a 92.1% annual fall,” she continues.
“Key to moving forward and helping the market to recover will be the number of new listings coming onto the market during May and consumer confidence levels – particularly in relation to ongoing employment and people’s ability to access finance. Lastly, we’ll be looking at metrics such as the sales price to CV ratio, percentage of auctions and median number of days to sell.
“Talking to our members around the country, there are good levels of activity starting to occur with both first time buyers and investors active in the market which is a positive sign. We expect this to pick up as we move into Level 2,” she continues
“However, we caution over being too optimistic until we get a few more months’ data, as many of the sales in April will have been negotiated during March, so it’s likely to be another month or so until we really see the full impact of the lockdown,” warns Norwell.