A full print version of the NZ Property Report – May 2012 is published below and is available for download (1.2MB) and distribution.

A video interview of the NZ Property Report for May with Bernard Hickey of Interest.co.nz provides a concise 6 minute insight into the market across the country.

Summary of the market – May 2012

The message in the property market for the past 6 months at least, has been that there is a shortage of listings. In the major metro areas of Auckland and Canterbury this shortage has been more acute especially at a suburb level. It appears from the May data on the supply side of the market that this message has finally got through to sellers. The level of new listings in May was counter-seasonal; when we normally see a slowing of new listings coming onto the market heading into winter we actually saw a rise, and quite a significant rise – 16% increase on a seasonally adjusted basis.

This rise in new stock has lead to a fast adjustment in a number of provincial regions where the market was firmly biased to sellers and is now showing a more balanced market. This however is not the outcome in Auckland and Canterbury where despite this surge of new listings, the inventory as measured against the rate of sale has actually fallen, demonstrating the levels of activity in these markets where property is selling fast.

The unseasonal rise in listings has certainly come with an ensuing surge of confidence in those new sellers – they have signaled this confidence in the asking price expectation, which has again set a new record level. This rise was most accentuated in the two key markets of Auckland and Canterbury which both set new record levels of asking price.

The challenge for the market in the coming winter period will be if the surge of listings continues and what impact that will have on the inventory and the ability for the buyer demand evident through the summer/autumn to continue, potentially less of an issue in the major metros than provincial regions.

Asking Price

The seasonally adjusted truncated mean asking price for listings in May set a new record high of $435,887, this represents a significant increase from the prior peak in March of this year of $429,865. The month-on-month increase of 2.8% is the highest single increase since Sep 2009. As compares to a year ago the truncated mean asking price is up 4.5%.

New Listings

The level of new listings coming onto the market in May rose sharply with a total of 11,544. This represents a seasonally adjusted 16% increase. The increase year-on-year is 17%.

On a 12 month moving average basis a total of 129,711 new listings have come onto the market since June 2011 as compared to 127,843 in the prior 12 month period, a rise of 1.5%. This is the first moving annual total increase in over a year.

Inventory

The level of unsold houses on the market at the end of May (46,016) was down as compared to April (46,948) as measured on a seasonally adjusted basis. The inventory as measured in terms of equivalent weeks of sales shows a further upturn to 35.7 weeks from 33.7 weeks last month. This is the third straight month with increasing inventory – reversing what had been a 6 month consistent decline from October through to March of this year.

Regional Summary – Asking price expectations

The national (seasonally adjusted) truncated mean asking price expectation among sellers rose significantly in May by 2.8% to $435,887.

Across the 19 regions of the country the price movements are varied with 11 showing increases and 8 decreases. The major movement are very evident on the East Coast with Gisborne, Hawkes Bay and Manawatu / Wanganui showing steep declines, joined by the West Coast. In contrast the five regions of Wairarapa, Northland, Coromandel, Nelson and Taranaki showed big increases, in the case of the latter region an increase of 15%.

The major metro regions showed slight movement with Auckland being the largest with a 1.7% increase to set a new record asking price of $578,533. Canterbury with a seasonally adjusted increase of just 0.5% though did also set a new record asking price at $383,504. Wellington by contrast was down 0.1% in seasonally adjusted asking price at $429,836 which is 5% below the peak asking price of Feb 2011.

Regional Summary – Listings

Listings volumes coming onto the market in May was well ahead of the seasonal trend which tends to see a slow down as the market heads towards winter. Across the country only one region (Central North Island) showed a decline in new listings as compared to last May.

Significant year-on-year increases of over 20% were seen in 9 of the 19 regions. The largest increases were in the West Coast (75%), Taranaki (72%), Northland (56%) and the Waikato (43%).

It is interesting to align the chart of new listings by region to the inventory by region. Most striking is the fact that the two regions facing the greatest shortage in listings being Auckland and Canterbury saw some of the lowest rise in new listings in the month, well below the national average.

Regional Summary – Inventory

The inventory of unsold homes on the market rose again in May, creeping closer to the long term average as the market re-balances.

This re-balancing is however not occurring in the two major markets of Canterbury and Auckland where the inventory continues to fall. Both Auckland and Canterbury have also reached new record 5 year lows in inventory and now both are over 33% below their respective long term average.

Noticeable outside of these regions is the extent to which the remaining 17 regions are edging out of tight sellers’ markets into more balanced markets and the emergence of some buyers markets. As compared to April when there were 4 provincial markets under strain of a shortage of listings to this month with none. The majority of provincial markets are fairly well balanced between buyer and sellers providing a good balance heading into the slightly quieter winter months.

Lifestyle

Lifestyle property listings rose in May in line with the trend of total listing. A total of 978 listings came onto the market, up 16% year-on-year and up 17% as compared to April. The truncated mean asking price for these listings rose 1.2% as compared to the recent 3 month average to $655,740 – taking the level to another record high in asking price, surpassing the peak attained over the last 3 months. Across the regions, Wellington recorded a new record high of $905,100.

Across the country, year-on-year comparison of new listings were up significantly in the Bay of Plenty (+96%), Taranaki (+92%) and Northland (+64%).

Apartments

Listings for apartments rose in May with 495 being brought to the market, on a year-on-year basis listings were up 22%. The truncated mean asking price of new listings slipped to $371,703 in May from $384,861 in April, representing a 3% year-on-year decrease and down 3% on the recent 3 month average.

The Auckland apartment market followed the national trend with 288 new listings coming onto the market, up 14% from April and also up 8% from May last year. The truncated mean asking price of new listings rose to $362,421 from $359,196 in April representing a 5% rise on the prior 3 months.

Notes:

Truncated mean

The monthly asking price for new listings presented in this report utilises the measure of ‘truncated mean’. This measure is judged to be a more accurate measure of the market price than average price as it statistically removes the extremes that exist within any property market that can so easily introduce a skew to traditional average price figures.

The truncated mean used in this report removes the upper 10% and the lower 10% of listings in each data set. An average or mean of the balance of listings is then calculated.

Methodology

With the largest database of properties for sale in NZ from licensed real estate agents, realestate.co.nz is uniquely placed to immediately identify any changes in the marketplace. The realestate.co.nz NZ Property Report is compiled from new listings coming onto the market from the more than 1,000 licensed real estate offices across NZ, representing more than 95% of all offices.

With an average monthly level of over 10,000 new listings, the realestate.co.nz NZ Property Report provides the largest monthly sample report on the residential property market, as well as a more timely view of the property market than any other property report. The data is collated and analysed at the close of each month, and the Report is compiled for the 1st day of the following month. This provides a feedback mechanism as to the immediate state of the market, well in advance of sales statistics, which by the very nature of the selling process can reflect activity with a lag of between 2 and 4 months.

In analysing the details of the 11,554 new listings in the month of May, a total of 373 listings have been excluded due to anomalies. The land area of the property defines the categorisation of Lifestyle property. The criterion is a property having in excess of 0.3 hectares and being situated outside metropolitan areas.

Seasonally adjustment

The core data for the NZ Property Report is seasonally adjusted to better represent the core underlying trend of the property market in NZ. In preparing this seasonally adjusted data Realestate.co.nz is grateful for the assistance of the New Zealand Institute of Economic Research (NZIER) who use an X12 ARIMA methodology to calculate seasonally adjusted data.

Background to Realestate.co.nz

Realestate.co.nz is the official website company of the real estate industry of New Zealand, it is an industry owned web business providing online marketing services to the real estate industry. The shareholders in the business comprise the REINZ (50%) and six of the largest real estate companies (50%).

The business operates a portfolio of websites all focused to specialist sectors of the real estate market:

Realestate.co.nz is the heart of the business and is focused to the residential property market. It features the most comprehensive selection of property for sale and rent across NZ. The website attracts a significant monthly audience of over 400,000 unique browsers, with over 110,000 of those visiting from countries outside of NZ.

nzFarms is a specialist website presenting the most comprehensive selection of farms and agricultural businesses on the market across NZ. At this time it features around 5,000 listings for all types of farms and agricultural land as well as over 11,000 lifestyle properties.

Prime Commercial is a specialist website presenting the most comprehensive selection of commercial property for purchase or lease on the market across NZ. At this time it features over 27,000 listings for all types of properties – retail, commercial, industrial and investment properties.

Prime Business is a specialist website presenting the most comprehensive selection of businesses for sale on the market across NZ. At this time it features over 4,300 listings for all types of businesses – retail, tourism, wholesale as well as franchise opportunities

Zoodle is a specialist property information website providing very detailed data on all residential properties in NZ. The database comprises over 1.6m properties with detailed specifications, map and local amenities. The site provides online reports for free and for purchase covering valuation and legal information to greatly assist the needs of property buyers and sellers.

The web business of Realestate.co.nz site is the most comprehensive real estate web operation in NZ, currently hosting over 110,000 listings, covering this portfolio of residential property for sale and rent, commercial property for sale and lease, rural properties and farms, as well as businesses for sale. With a subscriber base of over 1,000 offices, the company represents over 95% of all listings from licensed real estate agents in NZ.

The full NZ Property Report for May 2011 can be downloaded here (1.2MB pdf document). Additionally the raw data is accessible here as an Excel spreadsheet enabling anyone to analyse the raw data and establish any trends or observations.

Usage rights are governed under attribution to the source of the data being Realestate.co.nz. The next NZ Property Report for June 2012 will be published on this website on Sunday 1st July 2012 at 10am.

In the US the leading real estate website – Zillow reported recently that more half of all engagement with listings is occurring on a mobile platform.

Given the scale of usage it was natural for us to highlight the mobile usage on the stats that we showcase for every listing on the website – in case you did not already know how, just click the link under the listing number which counts the number of views.

Each day we now report the total for web viewings in blue and the viewing on the mobile app platform for Android and iPhone in green as shown below.

We all know about inflation, and a lot of us are aware that in the dim and distant memory we had to contend with annual inflation rates of well over 10% – look for a moment at this chart of NZ inflation over the past 40 years – peaking at close to 20% per annum. Think of that in terms of price increases every couple of weeks by retailers trying to keep up with the cost of goods.

When it comes to house prices we all seem to think or know that prices rise faster than inflation in the long term. Take for example this property recently featured for sale in Auckland – the background article says it was purchased  by the current owners in 1964 for £5,600 – today it has a rateable value of over $2.5m!

Out of interest the Reserve Bank online Inflation calculator states that ” a basket of goods and services that cost £5,600 in Q1 1964 would have cost the equivalent of $215,944.06 in Q4 2011″. That example would certainly support the view that property prices in the long term outpace inflation.

Inflation though has been somewhat more benign over the past decade – averaging just 2.7%. However this “low” level of inflation still has an effect in reducing the value of goods over time. Despite this low inflation of the past 12 years, $100 in 2000 would be worth $138.12 in today’s money – the power of compounding certainly adds up quickly.

So what has been the impact of inflation on property prices over the past 5 years since the property market fell from the heady heights of the middle of the last decade? As a base the REINZ / Reserve Bank Stratified Price index shows in the chart below that closing in on the 5th anniversary of the market fall the current property sales prices in April are still some 1.4% below the peak of November 2007.

Now by using the Reserve Bank inflation calculator you can see the true value of property prices adjusted for inflation over this 5 year period. The chart below shows the monthly Stratified median Price Index adjusted to today’s $ value.

Property prices are in fact 12.8% lower than they were when the market peaked in late 2007. At the lowest point in January last year they had fallen in inflation adjusted terms by over 16% from the peak of the market. What this means is that if you had bought a property in September 2007 at what was then the median price in NZ of $379,075; if the price of that property had increased in value by inflation alone over the close-to 5 year period it would today be worth $430,481. By comparison the median house price in NZ in April was $375,575. A difference of close to $55,000 – sobering to see!

In order to provide some assistance to home owners wondering what impact inflation has had on property appreciation over the past decade this chart below provides what I like to think of as a ready-reckoner. All you need to do is refer along the horizontal axis as to when you purchased your house and then see how much appreciation or depreciation has occurred to NZ property prices over that period. This refers to the median price of property sold each month, clearly property of differing condition and in different parts of the country would fair differently over the period, but never-the-less it does provide a useful guide.

So if you bought in January 2003 removing the impact of inflation the average NZ property will have appreciated in value by 45%, whereas sadly of you purchased a property in January 2008 the average NZ property will have depreciated by 7%.

What this also means as illustrated on the chart by the dotted vertical line, is that property purchased nearly 7 years ago in September 2005, when adjusted for inflation over the period has not really appreciated at all.

We appear from the data tracked at realestate.co.nz to finally be seeing an end to the mortgagee stress in the market. Whilst the property publications still feature the distressed black and white photo montage of current mortgagee properties the fact is the number of properties in NZ advertised as mortgagee sale or auction is on the decline and is edging closer to a level not seen since before the global financial crisis.

As of this week the number of mortgagee properties on the market has dropped below 190 – this compares to 260 a year ago and over 380 in May of 2009. These numbers might still seem significant, however when seen in the context of the current property market with just under 50,000 residential properties on the market this total represents less than one half of one percent of all listings.

In fact even at the peak of the distress in the property market the total never exceeded 1% – this compares to well over 10% of all US properties being sold over the recent 5 years being the subject of a foreclosure as the Americans term mortgagee sale.

However as is always the case scrape a little below the surface and you start to see some interesting facts. What appears to be a steady declining trend is actually a tale of 2 markets.

The chart below tracks the Auckland market for mortgagee listings as compared to the rest of NZ. As can be seen back in 2008/2009 at the peak of the financial crisis Auckland in total represented over half of all the mortgagee properties on the market.

Through 2010 and 2011 that percentage has been declining and has accelerated significantly in 2012 to the extent that Auckland today represents just 1 in 5 of all the mortgagee listings on the market. Whilst in contrast the financial pressure which can lead to mortgagee sales is still being felt outside of Auckland as the scale of listing for mortgagee properties has not changed that much over recent years.

Looking at specific regions; the Bay of Plenty stands out with 13% of the national total of all mortgagee listings as compared to just 4% at the peak of the market; Similarly Manawatu/Wanganui today represents 7% of all the national listings of mortgagee properties as compared to just 2% 4 years ago. Northland now has one in ten of all mortgagee listings as compared to one in twenty 4 years ago.

The pressure may be easing in the financial burden of mortgage sales but clearly it is not easing in an evenly distributed way across the country.

The April 2012 Auckland Property Report published by Realestate.co.nz provides an insight into the state of the Auckland property market as measured by the supply side of the property market over the month of April. The key measures of the market analysed in the report are the number of new listings, the asking price expectation for those new listings and the level of inventory of unsold houses on the market at this time. The report is compiled from data captured by the website and represents close to 98% of all property movements in the Auckland market as managed by licensed real estate agents.

A full print version of the Auckland Property Report – April 2012 is published below and is available for download (1.2MB) and distribution.

Summary of the market – April 2012

The Auckland property market continues to drive ahead, even as the remainder of the country sees some re-balancing of the market. The market is firmly in the seller’s camp and this is evident by the pressure of constrained inventory which continues to hold at levels well below long term average and a year ago. In fact the levels are the lowest seen since the start of the property market slow-up in 2007.

Sales of property remain strong with the 2,806 properties sold in March across the region, this is up 18% as compared to the prior year, but was very slightly down from February on a seasonally adjusted basis by 1%. This level of demand has driven the asking price higher as sellers read the market signals and recongise the potential for a stronger selling price than a year ago.

The weakness of listings remains of concern, the 3,159 new properties coming onto the market in April were down 5% on a year ago and 14% down on February on a seasonally adjusted basis.

The next 3 month traditionally represent a quieter time for new listings as sellers feel the summer peak appeal period has passed, this is however not the case when it comes to demand from buyers who remain active through this winter period, the key will be if astute sellers recognize this and capitalize on what appears to be sustained demand to seek the best outcome for their property sale.

Asking Price

The seasonally adjusted truncated mean asking price for listings in April rose again to a new record level of $568,820 up 1.7% on the March level and up 2.5% from April last year. Auckland asking prices are second only to the Queenstown region which is nudging the $600,000 asking price mark at $595,766 in April.

New Listings

The level of new listings coming onto the market in April fell significantly with a total of 3,159. This represents a fall of 5% as compared to April last year. On a seasonally adjusted basis the April figure was down 14% from March.

On a 12 month moving average basis a total of 42,272 new listings have come onto the market since May 2011 as compared to 41,850 in the prior 12 month period, a slight increase of just 1%. This compares to sales up 22% on the same 12 month comparable basis

Inventory

The level of unsold houses on the market at the end of April as measured on a seasonally adjusted basis at 10,941 was down 1% as compared to March. A year ago the inventory totaled 12,001.

As measured in weeks of equivalent sales the April level of 21.7 remained the same as March. The long term average for Auckland is 33 weeks and a year ago the level was 28 weeks.

Supplemental data

Property Sales

Property sales over the past 5 years in Auckland have gone through some significant shifts as the chart shows. There have been 2 periods with growth, and 2 periods of decline. Actual sales at this time (seasonally adjusted are at the highest level since the market suffered the significant decline between 2007 and 2008.  This current period of growth in sales started in October 2010 and represents a 76% increase from that time.

Sales Price

The Stratified mean sales price  (REINZ) for property in Auckland has gone through a sustained recovery over the past year and is now at a new high of $516,700. This represents a 1.3% increase from the prior high of July 2007. The chart very clearly reflects the impact of the price decline through the period of 2007 to 2009 resulting in a 14.6% adjustment in Auckland property prices.

A full print version of the NZ Property Report – April 2012 is published below and is available for download (1.2MB) and distribution.

Summary of the market – April 2012

April did not witness a flood of listings as might have been expected given the signals which have been flashing for some months now in the media that the property market is alert and very much alive; more so in the main centers of the country. Instead levels of listings were nearly identical to April last year.

This however, did not have the expected downward pressure on inventory of unsold houses on the market; this was due to the fact that whilst property sales are strong the latest month’s data for March did not show a seasonally adjusted increase.

This indicates that the market would appear not to be diving headlong into a property bubble, but rather is seeing steady turnover and pragmatic buying and selling in the main.

This behavoural change is supported by the asking price trend which in both seasonally adjusted and normal data eased slightly from recent consecutive new highs. This would support the view that the market is balancing buyers demand with sellers expectation well. Clearly there are pockets of the market where there is not quite this degree of balance, Auckland for example continues to feel the impact of listings in short supply with a new record high asking price, the 3rd in the past 8 months.

The next 3 months are traditionally a quieter time for the market with lower listings ahead of the spring pick up in August, if property sales continue strongly it is likely that asking prices may well creep up further as demand flows through to vendor expectations.

Asking Price

The seasonally adjusted truncated mean asking price for listings in April eased slightly to $423,832 from the high in March of $429,865. This easing in the month was not universally representative of all regions with Auckland again pushing a new higher peak of asking price.

The trend as seen in the chart covering the last 3 years very clearly shows a continuing growth in asking price over the recent 12 months as compared to 2010/2011.

New Listings

The level of new listings coming onto the market in April fell with a total of 10,174. This represents a seasonally adjusted 10% fall from March and is nearly identical to April last year.

On a 12 month moving average basis a total of 128,065 new listings have come onto the market since May 2011 as compared to 129,678 in the prior 12 month period, a fall of just 1.2%. This compares to sales which are up 18% on the same 12 month comparable basis

Inventory

The level of unsold houses on the market at the end of April (46,948) was up as compared to March (46,462) as measured on a seasonally adjusted basis. This total includes houses, apartments and lifestyle properties on the market. With the rising rate of property sales the inventory on the market has seen a significant drop off over the past 6 months pushing it well below the long term average of 41 weeks of equivalent sales.

Regional Summary – Asking price expectations

The national (seasonally adjusted) truncated mean asking price expectation among sellers eased slightly in April to $423,832.

Around the country the dominant trend was an easing of asking prices with 11 of the 19 regions reporting falls, ranging from just 0.2% in Gisborne to a massive 12.8% in Wiararapa. There were 5 regions where the asking price showed a fall of greater than 5% – Waikato, Nelson, Southland, Marlborough as well as Wairarapa.

In contrast there were some strong growth in asking price with Hawkes Bay and West Coast reporting prices up 14.1% and 5.1% respectively.

Two regions – Auckland and Hawkes Bay reported new record levels of asking prices, in the case of the Hawkes Bay the prior high was last seen way back in 2007 whereas Auckland’s prior high was only 2 months ago.

Regional Summary – Listings

Listings volumes coming onto the market in April matched last April with 10 of the 19 regions seeing less than the same volumes in April last year. Significantly lower volumes were seen in Gisborne (-63%) and Central Otago / Queenstown (-48%), with Coromandel, Central North Island and Nelson all seeing volumes of greater than 20% below last April.

In contrast new listings flowed onto the market across Marlborough, Northland, Hawkes Bay, West Coast and Taranaki with volumes of new listings in all of these regions over 25% up on prior year.

The overall picture from this regional view of listings certainly backs up the position of the market rebalancing in terms of listings.

Regional Summary – Inventory

The inventory of unsold homes on the market eased slightly in April having reached a 4 year low in March.

Across the country the regions showed some rebalancing with the overall trend to a sellers’ market dominating the majority of regions.

There are still 6 regions highlighted in dark blue on the adjacent chart where the market is firmly in the sellers’ domain, this is one less than last month with Marlborough easing the pressure with a stronger flow of new listings.

In contrast there are this month 5 regions where buyers have the upper hand (dark green in the adjacent chart) – 2 more than last month. These additions are Coromandel and Taranaki, this again is the result of stronger flow of new listings.

Lifestyle

Lifestyle property listings fell significantly in April after witnessing strong rises in February and March. A total of 835 listings came onto the market, down 20% year-on-year and down 28% as compared to March. The truncated mean asking price for these listings rose 3% as compared to the recent 3 month average to $655,009 – taking the level to another record high in asking price, surpassing the peak attained over the last 2 months. Across the regions, four reached new asking price highs – West Coast, Canterbury, Southland and Marlborough.

Across the country, listings were weak with just 6 regions reporting year-on-year growth in listings. In contrast lifestyle listings in the Hawkes Bay hit a new record high with 100 listings coming onto the market in April.

Apartments

Listings for apartments fell in April with just 398 being brought to the market, on a year-on-year basis listings were down 12%. The truncated mean asking price of new listings rose to $384,861 in April from $366,288 in March, representing a 4% year-on-year decrease but up 3% on the recent 3 month average.

The Auckland apartment market followed the national trend with 252 new listings coming onto the market, down 20% from March and also down 12% from April last year. The truncated mean asking price of new listings rose to $359,196 from $338,046 in March representing a 3% rise on the prior 3 months.

Notes:

Truncated mean

The monthly asking price for new listings presented in this report utilises the measure of ‘truncated mean’. This measure is judged to be a more accurate measure of the market price than average price as it statistically removes the extremes that exist within any property market that can so easily introduce a skew to traditional average price figures.

The truncated mean used in this report removes the upper 10% and the lower 10% of listings in each data set. An average or mean of the balance of listings is then calculated.

Methodology

With the largest database of properties for sale in NZ from licensed real estate agents, realestate.co.nz is uniquely placed to immediately identify any changes in the marketplace. The realestate.co.nz NZ Property Report is compiled from new listings coming onto the market from the more than 1,000 licensed real estate offices across NZ, representing more than 95% of all offices.

With an average monthly level of over 10,000 new listings, the realestate.co.nz NZ Property Report provides the largest monthly sample report on the residential property market, as well as a more timely view of the property market than any other property report. The data is collated and analysed at the close of each month, and the Report is compiled for the 1st day of the following month. This provides a feedback mechanism as to the immediate state of the market, well in advance of sales statistics, which by the very nature of the selling process can reflect activity with a lag of between 2 and 4 months.

In analysing the details of the 10,174 new listings in the month of April, a total of 145 listings have been excluded due to anomalies. The land area of the property defines the categorisation of Lifestyle property. The criterion is a property having in excess of 0.3 hectares and being situated outside metropolitan areas.

Seasonally adjustment

The core data for the NZ Property Report is seasonally adjusted to better represent the core underlying trend of the property market in NZ. In preparing this seasonally adjusted data Realestate.co.nz is grateful for the assistance of the New Zealand Institute of Economic Research (NZIER) who use an X12 ARIMA methodology to calculate seasonally adjusted data.

Background to Realestate.co.nz

Realestate.co.nz is the official website company of the real estate industry of New Zealand, it is an industry owned web business providing online marketing services to the real estate industry. The shareholders in the business comprise the REINZ (50%) and six of the largest real estate companies (50%).

The business operates a portfolio of websites all focused to specialist sectors of the real estate market:

Realestate.co.nz is the heart of the business and is focused to the residential property market. It features the most comprehensive selection of property for sale and rent across NZ. The website attracts a significant monthly audience of over 400,000 unique browsers, with over 110,000 of those visiting from countries outside of NZ.

nzFarms is a specialist website presenting the most comprehensive selection of farms and agricultural businesses on the market across NZ. At this time it features around 5,000 listings for all types of farms and agricultural land as well as over 11,000 lifestyle properties.

Prime Commercial is a specialist website presenting the most comprehensive selection of commercial property for purchase or lease on the market across NZ. At this time it features over 27,000 listings for all types of properties – retail, commercial, industrial and investment properties.

Prime Business is a specialist website presenting the most comprehensive selection of businesses for sale on the market across NZ. At this time it features over 4,300 listings for all types of businesses – retail, tourism, wholesale as well as franchise opportunities.

Zoodle is a specialist property information website providing very detailed data on all residential properties in NZ. The database comprises over 1.6m properties with detailed specifications, map and local amenities. The site provides online reports for free and for purchase covering valuation and legal information to greatly assist the needs of property buyers and sellers.

The web business of Realestate.co.nz site is the most comprehensive real estate web operation in NZ, currently hosting over 110,000 listings, covering this portfolio of residential property for sale and rent, commercial property for sale and lease, rural properties and farms, as well as businesses for sale. With a subscriber base of over 1,000 offices, the company represents over 95% of all listings from licensed real estate agents in NZ.

The full NZ Property Report for April 2011 can be downloaded here (1.2MB pdf document). Additionally the raw data tables with full data back to 2007 in both actual and seasonally adjusted form  is accessible on this freely available spreadsheet hosted on Google Docs enabling anyone to analyse the raw data and establish any trends or observations.

Usage rights are governed under attribution to the source of the data being Realestate.co.nz. The next NZ Property Report for May 2012 will be published on this website on Friday 1st June 2012 at 10am.

The chart below paints a very clear picture of this situation. The quarterly sales growth represented by the red bars shows that year-on-year sales growth has been in positive territory and growing at an accelerated rate for 4 consecutive quarters.

It all began a year ago, when in the second quarter of 2011 the sales year-on-year grew by 7%. The next quarter this grew to 18% and then in the final quarter of 2011 the sales of property really accelerated to 22% year-0n-year growth.

The start of 2012 has seen this growth accelerate again with a 29% growth. This growth represents 3,969 more properties sold in the first 3 months of 2012 than compared to the same time last year – an extra 44 properties a day being sold.

This rise in sales is not being matched as yet by a rise in new listings, as represented by the blue bars in the chart. In the first 3 months of 2012 there has been an increase, but only a 10% increase, but that is not approaching the consistent rise in property sales that has been seen over the past year.

This clearly demonstrates the lag that occurs between sales activity as a measure of demand in the property market and the resultant supply side reaction – usually a 6 months lag.

Around the country, across the 19 regions tracked by REINZ and Realestate.co.nz the picture in the majority of regions is consistent – listings lagging the rise in sales.

The region which standouts for a contrarian trend though is the Coromandel – weaker sales and declining listings.

Just compare NZ to Australia, here there is no Capital Gains Tax or Stamp duty; additionally overseas investors are restricted in Australia to new builds as opposed to the far more limited restrictions here.

These circumstances are driving an ever growing audience to listings on Realestate.co.nz from overseas. Just last month over 110,000 unique visitors checked out property on the site from outside NZ, that represents over 1 in 4 of all of our visitors each month.

The most active viewers are those in the English speaking countries of Australia, UK, US and Canada, but Asia is assuming a greater and greater presence among this audience growing at 3 times the rate of growth of other countries. This certainly reflects the economic relations NZ is building with its Asia Pacific partners.

This audience though is not as well catered for as English language speakers. This is somethingthat we have focused on over the past year. The main issue facing us has been the ability for us to provide a Chinese language version of the site which can rank highly when Chinese based property seekers are searching for NZ property – especially as the major search engine in China is Baidu. As a company we have always invested heavily in Search Engine Optimistion (SEO) to drive our site and brand given the credibility this brings to our site, however optimising in English for Google is a very different issue from optimising for Chinese language search on Baidu.

This challenge has been solved through a partnership which Realestate.co.nz has established with a NZ/Chinese company HouGarden.com. The company combines the domestic Chinese technology team with the best of SEO capabilities in the Chinese market. Based in Auckland and Beijing, Hougarden has built a website that provides a rich information source for property seekers combining the full listings from Realestate.co.nz translated into Chinese with translated news stories covering the broad NZ economy and property news.

It was decided that translated listings in Chinese would be best presented on a separate website and domain name, rather than on a sub domain of realestate.co.nz and that is the rationale for the partnership with Hougarden.

So how does it work?

Hougarden uses the API of Realestate.co.nz listings to populate their website, all the content of listings including photos, description as well as agent contact details are provided on the HouGarden site in Chinese. By using the API the listings on HouGarden are synchronised with Realestate.co.nz so new listings and withdrawn listings are updated at the same time.

The site provides the great functionality and usability as Realestate.co.nz and the deliberate similarity in look and feel is a deliberate decision to reflect the true partnership relationship.

Property seekers making an enquiry through the HouGarden website by email can choose to respond in Chinese or in English. These email pass through Realestate.co.nz with a human translations service provided by HouGarden. The agent will receive the enquiry in English with a clear message detailing that the enquiry has come via HouGarden website from a Chinese enquirer and whether the original enquiry was written in English or Chinese.

We recommend that agents receiving these enquiries develop a relationship with a Chinese speaking colleague to assist in managing these requests, although clearly an enquiry written originally in English can be directly responded to. It is the plan for the future for Hougarden to potentially provide a return translation service.

The launch of Hougarden was marked this week by a presentation and official signing ceremony in Auckland. Pictured below is Sam Yin the Managing Director of HouGarden.com with myself after the signing ceremony.

We are very excited by this development as a further means for Realestate.co.nz to provide increased profile and advertising for our customers’ listings – reaching out to the massive audience of 1.3 billion Chinese both in NZ and in China.

A staggering 1 in 5 of property hunters used a mobile device to find property information – 22% of all views of listings on realestate.co.nz were undertaken on the go, from a mobile device. That’s a massive increase from just 8% a year ago.

Even more impressive is the fact that mobile users engage with the mobile app far more than the website – it is turning out to be very “sticky” – the average visitor using the app views 37 pages per visit as compared to just 11 on the website. People clearly recognise the real value of having real data in the palm of their hand.

The key fact to bear in mind when it comes to mobile, is that users on the mobile platform are by-and-large more likely to be seriously active property seekers. The mobile is not a “lean back experience” as the web can be with super-glossy wide screen images, the mobile is about information. Location details, listing details, great photos and easy contact to the agent by phone, email or text.

Choice of mobile device

When it comes to the choice of device the most popular was the iPad – it represented nearly half of all mobile usage in March. On the iPad the app though only represented 20% of users with the other 80% of users choosing to view the website on the device. The iPhone represented 40% of all mobile users in the month with a 60/40 split between the app and the web. Android came in 3rd with 14% of all mobile users, although it is fast catching up ground, with a 6 fold increase in the past year; its usage is evenly split between app and the web.

There are some interesting insights of mobile usage which surprise some people. Mobile usage is not restricted to just the main cities and large towns, in an average month, every single listings we have in the database with an address is viewed at least once. That shows the mobile app is used right around the country when discovering property around you for sale or rent from Kaitia to the Bluff!

NZ’s favourite real estate app

The app is clearly NZ’s favourite real estate app, blasting through 70,000th downloads and only growing faster by the day – an average week sees around 1,200 downloads, in the 4 days over Easter we saw over 1,600 downloads; taking us ever closer to 100,000 downloads in the next few months.

In the month of March over 85,000 visitors opened up the app to discover property for rent and for sale right around them, letting them make better house hunting decisions whilst out-and-about.

New Advertising

To further accelerate this rate of download and usage we are delighted to have our partner Westpac undertake another extensive advertising campaign on bus shelters and on TV. Our partnership with Westpac is mutually beneficial adding value to Westpac customers to help them in the home buying process by showing them a smart way to house hunt on the go with the app, as well as info on local branches, ATM’s and also contact details for their Mobile Mortgage Managers.

International Benchmarking

It is always useful to compare NZ uptake and usage of real estate mobile with key developed markets such as UK, Australia and the US.

The data for the UK is not the most recent; the leading website for real estate in the UK is Rightmove, back in August last year they reported in their half year report that 14% of access to listing was via the mobile, I am sure that has grown significantly since then.

In Australia the leading website of realestate.com.au reported that at December they had reached 700,000 downloads of their mobile apps. With a population 5 times that of NZ this means that our activity level is about half that of Australia.

In the US the leading website of Zillow was a very early innovator of the mobile platform, starting with an iPhone app in 2009 and now having an app for all platforms (inc Windows and Blackberry) – they report usage on mobile being 24% of all access to listings. In their Q4 financial report for 2011 they reported also that property was viewed on the mobile devices at the rate of 53 houses per second (3,180 per minute) in January. Now that is a stunning stat. For us in NZ we are currently seeing a rate of 24 houses viewed per minute. Allowing for the fact that the US population is 71 times that of NZ means that we are seeing activity at about half the rate of the US.

So as ever the rate of development overseas shows us how the the future is likely to look; and it looks like we will continue to see exponential growth in mobile usage across the various mobile devices, with NZ’s favourite real estate app only continuing to grow faster in usage and engagement.

The Realestate.co.nz mobile app is available for free from the Apple app store for iPhone or the Google Play store for Android devices.

At the peak of the financial crisis the number of properties being marketed as mortgagee sales hit 423 across the country, that was back in November 2008, today that number is 216. Currently around 30 properties a week are marketed as mortgagee sales, and given the financial imperative of the bank or financial institution the properties tend to sell fairly quickly seeing properties not hanging round long on the market.

The chart below updates the last 5 years of data and graphically shows the steep rise at the start of the global financial crisis and the slow steady recovery since then.

In real terms each property put up for mortgagee sale is a human story about over leveraged financial management, but in absolute terms the number of mortgagee properties in NZ remains relatively low when judged against the property market in general. At no time over the past 5 years has the number of mortgagee properties on the market in NZ ever exceeded 1% of all properties being marketed – at its worst mortgagee properties represented just 1 in 132 of the properties on the market. Compare that to the US where although things are looking brighter the story a year ago from Bloomberg showed 3 million homes foreclosed since the start of the crisis (for reference US house sales are around 4 million a year).

One way to evaluate the current tracking of mortgagee listings in NZ is as shown below matching week by week for the past 5 years the % of mortgagee listings of the total of all listings.

This chart tracks in red the current year and shows that weekly this year is looking to be at a similar level to 2010, far lower than the worst year of 2009 and down on last year. The reason for the somewhat higher level of listings last year could well have been as a result of banks looking to liquidate their repossessed properties as the property market began to regain life and activity.

Regional Variance

One noticeable trend within the data of mortgagee listings is the split between the major metro areas of Auckland, Wellington and Christchurch and the provincial ares of the country.

The blue line tracks the listings in the major cities with the red showing provincial areas. As the financial crisis hit the early impact was seen in the cities (potentially in the area of apartments and investment properties) whereas as time has gone on the provincial areas have actually been creeping up and have in the past 3 months overtaken the cities to represent a higher percentage of current mortgagee properties on the market.

This week the region with the highest proportion of mortgagee properties is the Hawkes Bay where there is one mortgagee property for ever 123 properties on the market (0.81% of all listings) – a total of 17 properties; by contrast Taranaki, Nelson, West Coast and Otago had just one mortgagee property each on the market.