MARCH 2024 - HARCOURTS GOLD CHRISTCHURCH MARKET REPORT

The Christchurch residential property market has continued its recovery, with a further increase in sales for March 2024. There are several puzzle pieces yet to find their place in the near future, though these factors are likely to assist our Christchurch market to endure the remainder of 2024.

Year on year, the March median sale price was up 3% from March 2023, however the median price fell when compared with February 2024 from $721,000 to $701,250 in March 2024. This was largely due to around half of the cities sales occurring at $700,000 or below across the month. It does not highlight the premium sales that also occurred throughout the month in Christchurch, which saw the average sale price increasing in March 2024 both year on year and month on month.

The speed of sale dropped again in Christchurch from 31 days in February 2024 to 28 days in March 2024. This demonstrates that new listings from February were met with market-ready buyer interest in March 2024. While multi-offers and buyer competition did occur across the month, the success of many sales relied on one buyer, willing and qualified, to negotiate a purchase.

Christchurch saw a 9% increase in the number of sales from 610 in February 2024 to 665 sales over March 2024 and was 4% up from March 2023, the continuing incline is slow but shows a steady return of confidence and credit considerations slowly allowing more moves.

The market sentiment remains somewhere between flat and balanced depending on the property offered. More buyers are gaining finance approvals, though interest rates remain on the high side, and approvals are still taking time. Once approved, many first-time buyers remain resistant to the reality of a property purchase, largely due to the restriction of lifestyle choices in the short term. Those buyers that make it work over the next 18 months to 2 years are likely to benefit from lower interest rates, home security and equity into the future.

We await 1 July to see the reaction to brightline changes, it’s yet to be seen if the exchange of investors getting out of the market will saturate us with entry-level opportunities or be met with new investor enthusiasm seeking renewed interest deductibility. Currently the number of available properties on realestate.co.nz remains down from the Canterbury long-term average of 21 weeks, with inventory of just 16 weeks recorded in March 2024.

The government review of building costs, with the announcement that cheaper building materials may become more readily available, could have quite an impact here, given we recently became the second most expensive city to build in and we have the land available to build on.

The official cash rate remained the same at 5.5% at the latest announcement on 10 April 2024. The Reserve Bank choosing to hold, signals inflation has not yet reached the lower levels they are aiming for. The next review is in May with early forecasts stating that 5.5% will be the outcome again.

We are yet to see if the economy will fall for a third quarter and if Christchurch will begin to feel the full brunt of the recession, on top of the inflation pressures that have already been the cause of cautiousness. We can view the figures for March 2024 with optimism of where we have been, though it is with a justified level of precaution that all parties watch on ahead of the winter market.

REINZ Figures: Median $701,250 | Average $823,163                                                                         

Harcourts Figures:  Median $735,000 | Average $879,125