New Zealand Sees Record-Low House Sales as Buyers Step Away

New Zealand house sales fell to a record low in the three months through September as a slump in prices spooked buyers.

(Bloomberg) — New Zealand house sales fell to a record low in the three months through September as a slump in prices spooked buyers.

Sales of residential and lifestyle properties fell to 14,966 in the third quarter last year, which was the lowest since records began in 1990, according to CoreLogic New Zealand data published by the Reserve Bank Thursday in Wellington. The volume is below the previous low of 15,579 seen during the financial crisis of 2008.

Property prices have tumbled as the RBNZ raises interest rates to combat soaring inflation. Average prices fell 5% in December from 12 months earlier, the biggest drop for a calendar year since 2008, and are tipped to fall further as the central bank continues to tighten policy in early 2023.

Sales slowed dramatically last year as prices reversed after an almost 30% gain in 2021. Buyers who were tapping cheap loans for fear of missing out quickly stepped away from the market because they were wary of overpaying.

The CoreLogic data is lagged because it includes all settled property sales. The series is subject to revision, with second-quarter sales revised up to 16,785 from 15,992 previously.

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