Average asking prices of homes listed for sale are barely moving says Trade Me Property

House price inflation could be grinding to a halt, according to new figures released by Trade Me Property.

The average asking price for properties listed for sale on the website during the three months to the end of September was just 0.1% higher than for the three months to August, according to the inaugural Trade Me Property Price Index.

The index has shown a marked slowdown in the rise of asking prices since May, when the rate of increase slumped sharply to under 0.5% and then went into negative territory in June and July. 

It has barely remained in positive territory in August and September, suggesting asking prices are largely flat.

That is a turnaround from the first quarter of the year when the index was increasing by more than 3% a month.

Trade Me’s head of property Nigel Jefferies said the national average asking price peaked at $491,050 in the three months to March and had fallen back slightly to $487,650 in the three months to September.

However that figure was still up 13.3% on a year earlier.

Jefferies said the longer term data provided further evidence of the market cooling.

“We looked back to September 2009 and compared this with September 2014 and we’ve seen asking prices rise by 26% over that period.

“A good chunk of that rise has been over the last two years, but in recent months we’ve seen that pace of increase all but stutter to a halt.”

Around the regions, average asking prices in Auckland were up 10.1% for the year and in Canterbury they were up 12.6%. The biggest increase was in Taranaki where the average asking price was up 23.4% for the year followed by Gisborne at 19%.

In the Bay of Plenty the average was up 5.4% and in Wellington they rose 6.8% and in Otago were up 12.8%.

Jeffries said the recent flattening was mainly driven by a slowdown in asking prices for larger homes, which were up 9% for the year while average asking prices for small and medium sized homes were up 15%.

“The trend was most noticeable in Wellington where larger houses showed a year on year decline of 5%, despite the overall market in the capital ticking up nearly 7%,” Jeffries said.

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