Data Show That Policy Slowing Housing Market As Desired
The RBNZ’s 325bp of tightening this cycle and other policy measures to slow the housing market can now be clearly seen in the REINZ’s data for October. This correction is a desired outcome given that REINZ median dwelling sales prices rose 67.6% between January 2019 and the peak in November 2021. In October they were down 10.8% from the peak.
- Dwelling sales often lead prices and the REINZ data suggest that prices have further to go. House sales deteriorated again in October falling 34.7% y/y after -10.9% the previous month. However, it is a volatile series and a big jump in October 2021 sales weighed on the annual rate this year. The 3-month average was in line with September at -21.3% y/y and suggests that the rate of deterioration may be stabilising.
- The median sales price fell 7.5% y/y and the 3-month average -3.8% y/y, the lowest since the start of 2009.
- The number of days to sell a dwelling usually falls in October but despite this, this year’s 44 days was still 10 days above last October.
Source: MNI - Market News/REINZ/Refinitiv