New Zealand’s house sales volume continues to drop in October

New Zealand’s housing market is easing. The national sales volumes of houses continued to drop in October. The sales volume fell a seasonally adjusted 9.1 percent in sequential terms in the month. This is after the sales volume dropped 5.5 percent in sequential terms in the prior month. The October’s decline is the fifth drop in the last six months. The number of house sales fell to the lowest level since October 2014.

Softness in t he sales of houses in the country was broad-based. Every region is expected to have registered softer sales in the month. Sales in Auckland fell 8.5 percent month-on-month, whereas ex-Auckland sales dropped 9.4 percent.

The weakness in the housing market is not just due to lack of inventory. It is expected to be wider than that. Subdued demand is also hurting the housing market. This was seen by the fact that the median number of days to sell continues to rise, noted ANZ in a research note.

The REINZ Stratified House Price Index, a measure of house prices, remained quite unchanged in October, representing a rise of 0.1 percent sequentially. The annual price growth continued to stay strong at 14.4 percent; however, there is definitely a weaker undercurrent, with prices falling 0.8 percent quarter-on-quarter and three-month annualized pace falling to just 4 percent. A slower price growth pace is clear throughout several parts of the nation. Median house prices dropped 0.9 percent sequentially.

At 04.00 GMT, the FxWirePro's Hourly New Zealand Dollar Strength Index stood slightly bearish at -84.2077 (between -75 and -`100 represents slightly bearish trend).