NZ: Housing market tentatively stabilising – ANZ

ANZ analysts suggest that New Zealand’s housing market has tentatively stabilised as nationwide, house prices were up 2.1% y/y in August, up from 1.7% y/y in July.

Key Quotes

“Auckland house price inflation is still negative in annual terms, but a little less than previously, contracting 2.6% y/y. Auckland house prices continued to underperform the broader market, rising less than the ex-Auckland index, which ticked up to 6.8% y/y. But housing market activity still remains soft.”

“Creating a bit more of a mixed picture, house sales more than reversed last month’s strength, falling 7.5% m/m. This saw annual sales growth at -0.1% y/y. The notable boost to house prices in August may reflect support from lower mortgage rates over the past year, but the reversal in sales activity supports the view that the market is unlikely to take off substantially from here. While we expect the market to remain subdued overall, there is a risk that recent drops in mortgage rates reignite the housing market.”