Housing market could bloom in spring – website

NZPA | Wednesday July 1 2009 – 09:48am

A June snapshot of the residential property market showed stability returning, says the website Realestate.co.nz.

According to the website’s June report, released today, the number of new listings declined for the fourth consecutive month and was down 24 percent compared to June 2008.

Reduced listings meant the available inventory of residential property — measured in terms of the number of weeks of average sales it would take to “clear” the market — fell to 31.5 weeks, a 37 percent drop from the 50.2 weeks level of June 2008.

The combined drop in new listings and available inventory was a major turn-around from the stagnated market of six or nine months ago, said Realestate.co.nz chief executive Alistair Helm.

Property sales were then at record low levels and the lack of buying interest meant available inventory had built up to over 52 weeks of average sales .

With sales volumes on the rise but the stock of available properties reduced, it could mean that after the traditional quiet winter period the market could become very active in spring, Mr Helm said.

“It looks like by September this year we are likely to have a growing number of spring home buyers chasing a falling number of properties on the market.

“If the downward trend in inventory continues, at some point this could lead to price pressure creeping back into some pockets of the market. This has to be the eventual outcome.

“The long-held fears that we might see a fall of up to 30 percent in house prices have proven to be unfounded. It is hard to predict, but I don’t see any immediate signs of prices dropping any further.”