“The data tell us that we are past the worst point for this particular period in the residential real estate market,” Alexander said. “However, some caution is needed in interpreting the improvement from last month because there is a seasonal effect at work.”
The pick-up comes as BNZ analysis shows the housing market is effectively flatlining, with affordability at its best level in more than four years. BNZ’s index estimates properties are now about 17% more affordable than at their worst point in December 2021, aided by falling mortgage rates, steady prices, and income growth.
Prices still under pressure
Despite the lift in activity, prices remain under downward pressure. A net 13% of agents said prices are falling in their area, an improvement from a net 20% last month and 38% in May.
“The result remains negative and there is a reasonable correlation between this measure and the eventual track for house prices captured in the REINZ’s nationwide House Price Index which has now decreased five months in a row,” Alexander said.
BNZ chief economist Mike Jones said recent REINZ data confirms the market recovery has stalled, with small declines in June and July. BNZ has nudged its annual house price inflation forecast down to just 1% for 2025, suggesting prices could end the year back near 2021 levels.