Buyers are making a comeback to the market, leading to a rise in sales that is gradually reducing the country's available property listings.

In July, data from CoreLogic NZ revealed a remarkable 17% surge in residential sales over the 12-month period ending in June. This notable increase closely followed the previous month's 8% annual rise in sales figures[i].

CoreLogic NZ Chief Property Economist Kelvin Davidson said two consecutive months of improved activity, measured across agent deals and private activity, was a strong indication that sales volumes were bottoming out.

“It’s important to note that this increase has started from a low base, but as pent-up demand starts to emerge it’s likely we’ll see more increases in sales activity in the remainder of 2023,” Kelvin said.

An improvement in sales volumes reflects the broad peak in mortgage rates, the ongoing strength of the labour market, high net migration, and slightly looser credit rules – as well as a tentative change in house-buyer confidence.

The figures also showed new listings remain sluggish, down -30.8% in the four weeks to 2 July compared to the same period last year and they remain almost 25% below the previous five-year average.

According to Kelvin Davidson, the flow of new listings onto the market each week remains at a low level. As such, the current increase in sales is gradually depleting the overall supply of listed properties, particularly in prominent regions like Auckland, Bay of Plenty, and Wellington.

“The flow of new listings coming onto the market each week has remained sluggish month-to-month, as would-be vendors choose to ‘wait and see’, given the uncertainty about how long a sale might take and/or the potential price achieved,” he said.

Keith Niederer, Network Manager at NZ Raine & Horne, “Following a challenging period for the real estate industry, the conclusion of the interest rate hike cycle has led to a rise in sales. However, we also now need to factor in the decline in the number of property listings available.

“The Waikato and Bay of Plenty regions always attract a lot of buyers from Auckland and Wellington, and we expect this trend to collect some speed as real estate confidence continues its return to form,” he said.

“These factors in combination are expected to exert upwards pressure on property prices in the coming months, which is great news for property owners.”

If you’re looking to buy or sell a property, contact your local Raine & Horne estate agent today.