Ōtautahi – Interest from rural real estate buyers is falling as the country heads into economic headwinds.
Data released today by the Real Estate Institute of New Zealand (REINZ) shows a slow market with fewer sales and lower sale prices.
For the three months to the end of February, 92 fewer lifestyle properties sold (-8.3 percent) than for the three months ended January 2023.
Shane O’Brien, Rural Spokesman, at REINZ says the February sales results have showed an expected continuation in the trend of the previous three months with a lower number of listings in most areas compared to previous years.
“The increase in interest rates has impacted buyer decisions and the reported slowing of the residential market could limit the buyer pool for lifestyle properties across New Zealand in the short term,” he says.
Overall, there were 1023 lifestyle property sales in the three months ended February 2023, compared to 1754 lifestyle property sales for the same period last year.
A total of 6219 lifestyle properties were sold in the year to February 2023, -2,936 (-32.1 percent) less than were sold in the year to February 2022. The value of lifestyle properties sold was $7.44 billion for the year to February 2023.
The median price for all lifestyle properties sold in the three months to February 2023 was $949,000
The median price for bare land lifestyle properties sold in the three months to February 2023 was $400,000. The median price for farmlet lifestyle properties sold in the three months to February 2023 was $1,100,000.
The slowing in the lifestyle property sales is not unexpected going into an election year. This is further exasperated by the recent increase in interest rates and a general slowing of the economy impacting buyers confidence in uncertain times.
There are however some positive signs being noted with a number of strong sales in the top end of the market in many areas.
No regions recorded an increase in sales compared to February 2022, with Nelson / Marlborough (-23 sales) and Taranaki (-24 sales) observing the smallest decreases. Auckland (-118 sales) and Waikato (-116 sales) recorded the biggest decreases in sales in the three months to February 2023 compared to the three months to February 2022.
Compared to the three months to January 2023, 2 regions recorded an increase in sales.
Two regions saw the median price of lifestyle blocks increase between the three months ending February 2022 and the three months ending February 2023.
The most notable examples were in Taranaki (+24.6 percent) and Southland (+12.1 percent) with the biggest decreases being in Manawatu-Wanganui (-30.6 percent) and Wellington (-26.5 percent).
The median number of days to sell for lifestyle properties was 19 days more in the three months to February 2023 than in the three months to February 2022, sitting at 59 days.
West Coast (43 days) recorded the shortest number of days to sell in February 2023. Bay of Plenty (80 days) recorded the longest number of days to sell.
