DEAR PROPERTY OWNER ,
Welcome to our 51st edition of Ray White Now .
We publish Ray White Now on a monthly basis and have done since April 2020 , when continued messages were being communicated into the market based on broad observations and opinions .
At Ray White , we sell 23.49 per cent of all residential property across New Zealand . In doing so , our listing volumes for the month of April saw Ray White as the number one listing agency across New Zealand . This allows us the scope to bring you data in real-time . Data that is directly from sales we undertake across our 192 offices in New Zealand .
While changes have quickly occurred in the confidence of buyers and sellers to transact real estate across New Zealand , the ability to borrow money has had increased barriers over the past quarter . When this is linked to rising interest rates , affordability has resurfaced as a key issue in buyer and sales rates .
Looking at where the market has come from , it is not a surprise to many that a slowdown had to occur . Some markets have experienced higher increases which changed the average price considerably . Since COVID-19 and post our first lockdown in April 2020 , prices have surged an average of 41 per cent during the past two years across New Zealand .
This dynamic in housing price increase has never occurred in previous real estate markets in such a short amount of time . Interest rates dropped to record low levels , and borrowing was encouraged . This allowed buyers to enter the market and sellers to take a perceived uplift in price . Confidence abounded in the market in New Zealand , property became very much the talking point , and the success of marketing property increased , which delivered higher sale prices and lower days on market .
We learned new acronyms such as FOMO ( fear of missing out ), which became commonplace for buyers who were outbid at auctions and became the preferred method of marketing . In April 2020 , at one stage , upwards of 75 per cent of all property was auctioned or submitted to the market by tender . Much of the property sales were also done remotely , given the environment we were all transacting in .
Fast forward to October 2021 , and the Reserve Bank advises the first upward lift in interest rates since 2014 . After 25 progressive statements of either stable or lowering interest rates , this was the first time the market had experienced an upward lift . Although this was only 25 basis points , it was enough to indicate more interest rate rises were to be expected .
Since then , we have experienced three further interest-rate rises in November 2021 , 25 basis points ; in February 2022 , a further 25 basis points ; and in April 2022 , a lift of 50 basis points . This has lifted the official cash interest rate to 1.5 basis points from 0.25 basis points only six months ago . It may not seem like a high-level increase in terms of quantum , but in real terms , the lift has been fivefold and is expected to continue increasing .