NZ: House sales have been flat but oscillating - ANZ

Liz Kendall, senior economist at ANZ, notes that New Zealand’s REINZ house sales increased 14% m/m in January (sa, ANZ estimate), reflecting some continuation of recent data volatility, with perhaps a small bump from the RBNZ’s relaxation of loan-to-value ratio restrictions.

Key Quotes

“Overall, sales have been flat but oscillating, to be 1% lower than a year ago (3mma). House prices rose 0.3% m/m, with annual growth tracking at 3.1% y/y.”

“Auckland weakness continues, with prices down 2% over the past year. Looking forward, we expect continued gentle moderation in price pressures, with headwinds weighing on the market.”

“Affordability constraints are being felt and investors are wary, especially with the longer-term prospect of a capital gains tax looming. Credit availability does not appear to be a particular constraint, though proposed changes in bank capital requirements will likely weigh if implemented.”