"With 20% deposit requirements for owner-occupiers and 30% for property investors taking effect from 1 March, most anticipated some cooling. Not so. In fact, quite the opposite. Unbelievably, real estate in March achieved record sales highs for price, speed, and volume," says Derryn Mayne, Owner of Century 21 New Zealand.
Her comments follow REINZ releasing its Monthly Property Report for March which confirmed New Zealand's real estate market maintained its unrelenting strength despite attempts by the Reserve Bank and the Government to slow it down.
Reaching a new record high for the country, median house prices across New Zealand increased by 24.3% to $826,300 in March 2021 compared to the previous March, with 12 out of 16 regions reaching record median prices.
It also saw the highest number of properties sold in a March month in 14 years, while the median number of days to sell a property - at 28 days - was the lowest for a March month since records began.
"As well as the tougher loan-to-value ratios (LVRs) from 1 March, the Government made its housing announcements hitting investors on 23 March, and ended the mortgage holiday scheme on 31 March. While the impact of these measures hasn't been reflected in the March numbers, I strongly suspect April's numbers will be a little calmer," says the Century 21 leader.
She says the fact that Auckland achieved a record median house price of $1,120,000, up by 18.5% in 12 months, is particularly impressive given the region was in Level 3 lockdown for the first week of March, with Level 1 activity not returning until 12 March.
"March threw a Level 3 lockdown at Auckland, higher deposit requirements for all buyers, the Government got really grumpy on investors wiping interest tax deductibility and extending the bright-line test to 10 years, and yet the market in March didn't even blink! An incredible result, but such red-hot urgency and action is definitely starting to ease," she says.
Derryn Mayne says with a general expectation that such pace will not continue, those Kiwis contemplating selling should act, with Century 21 agents busy now with appraisals.
"Let's not also forget that from 1 May property investors will be required to stump up a 40% deposit which will definitely take out many 'mums and dads' contemplating buying a rental property. With interest rates still rock bottom and economic confidence reasonably positive, I'd be selling this side of winter," she says.