Realestate.co.nz chief executive Alistair Helm says the New Zealand property market is a long way from a boom – despite the latest REINZ figures showing a 19.9% year-on-year increase in house sales.
Helm said the market had to recover from a very low point.
Sales fell between 2007 and 2009 from 105,000 a year to 55,000.
In order to really take off, there would have to be another 20 per cent increase in sales between July 2012 and July 2013, he said.
“The current 12-month average is tracking at 69,000 with an expectation of 72,000 by the end of the year. This total now marginally surpasses the ‘dead-cat bounce’ mini-peak of January 2010. In terms of the value of transactions this is now running at an annualised rate of $30.64 billion, up 40% from the lowest point in February 2009 at $21.91 billion.”
He said the current sales rate of 4.5% of all dwellings per year was well below the long-term average of 6%.
“The market is staging a recovery as the general population regain a sense of confidence in the general economy and are clearly being influenced with what are very attractive interest rates. However we would need to see another year of 20% growth on top of this year’s 20% growth before we would be anything like approaching the long term average level of sales.”