Over the past four weeks we have seen a small number of signs appearing telling us that peak frenzy in housing markets around New Zealand was probably reached in November last year, and things are now on a slowing track. Having said that, activity remains very strong, FOMO is rampant, and I have received many emails from people describing what they consider to be extreme prices being paid for some properties.
So while there may be a slowing underway, we are well away yet from being able to use words to describe our housing markets such as “calm” or “steady”.
One slowing indicator comes from REINZ’s House Price Index for all the country which rose by 3.9% in November, but then by 2.2% in December and 1.3% in January. Prices growth has slowed. Sales nationwide in November were 34% ahead of a year earlier, December 46%, but January just 3%.
In my monthly mortgages.co.nz & Tony Alexander Mortgage Advisors Survey, a net 5% of advisors reported that they are seeing fewer investors coming forward for advice. This is the first time that particular indicator has been negative.
In the REINZ & Tony Alexander Real Estate Survey only a net 15% of agents last week said that they were seeing more investors in the market. That is an increase for sure. But it is less than the net 31% in February seeing more investors, 45% in December, and 59% in November.
That survey also told us that in early-March a net 5% of agents were seeing more investors stepping forward to sell their property. That is the first time this measure has been positive. Up to this month all other months had produced a net balance of agents saying that fewer investors were looking to sell.
Finally, in my Tony’s View Spending Plans Survey for March, a net 5% of the over 1,200 people replying said that they planned buying an investment property over the next 3-6 months. That result is down from 11% in February and a peak of 13% in December.
Interestingly, while there was also a fall in the net proportion of people saying they plan buying a home to live in, the decline was small from 6% to 4% with December having been also 4%.
Basically, the data in hand show slowing price growth on average, and my surveys suggest some investors are pulling back from extra buying while bringing some of their properties forward to the market.