Data from realestate.co.nz signals that the property market is heating up, with demand for property increasing steadily over the last 12 months. Property data tends to review supply (number of properties on the market) and asking prices, but this new dataset allows us to round out the economic equation by taking a deeper dive into demand by looking at searches and engagements per listing compared with the number of properties available-.
The overall demand is determined by the number of property searches undertaken on the site divided by the number of properties available. Engagement goes a step further to indicate active demand as it combines the number of times a property has been saved or enquired about.
Brad Olsen, Chief Executive and Principal Economist at Infometrics, says the new data is a welcome addition to New Zealand’s property scene:
“Rising searches supports other data that has shown more interest in the housing market, and increased engagement per listing also supports the view that people looking in the market are increasingly serious about making purchasing decisions, rather than just passively observing what’s on the market.”
“This data also shows where Kiwis’ relative interest in housing is, with areas like Queenstown and Gisborne seeing a larger number of searches and engagements per listing compared to the national average.”
Vanessa Williams, spokesperson for realestate.co.nz, says the data gives us a good steer on demand because it doesn’t just tell us how many people are searching for property or actively engaging with listings but how much supply they are competing for:
“It helps us to understand the relationship between supply and demand. More searches or engagements per listing likely means more competition.” “This data set is a more in-depth way of reviewing property demand than looking at the number of people on the site alone.” Over the last 12 months, both searches and engagements per listing have steadily increased.
“Overall, both indicators have been trending up. We saw an expected dip during September around the election, but things look to be on the rise again,” says Vanessa. Vanessa explains that we typically see searches and engagements drop off in December as people put their property plans on hold over the festive season, but the first few months of the year are usually a busy period for buyers and sellers.
“The drop off we saw in demand during February could be due to the extreme weather events around the country and perhaps also wider economic factors, like the 10th consecutive OCR hike, which happened in February,” says Vanessa.
Compared to October 2022, demand was up across the country last month. Looking nationally, searches per listing were up 1.9%, while engagements per listing were up 26.4% year-on-year in October. She notes that while searches were relatively flat between September and October, engagements jumped up.
“Not only are we seeing an increase in the number of people searching for property, but given the significant lift in engagements, it appears that New Zealanders are moving from a passive to a more active mindset,” says Vanessa. realestate.co.nz’s recent property report also showed increased confidence in the property market with more new listings coming onto the market, the national average asking price returning to January 2023 levels, and auctions regaining popularity.
Demand up year-on-year in New Zealand’s main centres Year-on-year, demand increased during October in our main centres of Auckland, Bay of Plenty, Waikato, Wellington, and Canterbury. Wellington saw the biggest increase in demand, with searches up by 47.7%, followed by Waikato up 8.0%, Auckland up 6.4%, Bay of Plenty up 3.9%, and Canterbury up 1.7%. Engagements per listing were also up in these regions, again with Wellington leading the charge, up 88.5%, Bay of Plenty up 54.7%, Auckland up 47.7%, Waikato up 46.3%, and Canterbury up 14.7%.
Vanessa says this tells us that there is more interest from buyers now than there was a year ago: “Buyers aren’t just searching for property but saving their favourites and making the move to enquire with a real estate agent about a property that best fits their lifestyle.” “And, relative to the number of homes available, they are doing this more than they were in October 2022.”
Demand highest in Gisborne, Central Otago Lakes District and Otago
Year-on-year, our main centres might have seen demand grow. But when you look at the numbers, Gisborne, Otago, and Central Otago/Lakes District have consistently seen higher demand than any other region in New Zealand over the last 12 months. Gisborne had the highest number of searches per listing during October, with similar numbers seen over the last year. Vanessa says some of this could be related to cyclone damage in the region cutting into supply.
“We have seen low stock levels in Gisborne throughout the year, which could be contributing to more competition for the homes that are available for sale in the area.”
Comparatively, Auckland had around a fifth of the number of searches per listing during October. Central Otago/Lakes District and Otago were the next most in-demand regions, and interestingly, a lot of this is being driven by Aucklanders. Property seekers looking outside their region During October, the highest number of property searches for Central Otago/Lakes District and Otago were performed by people located in Auckland.
In Central Otago/Lakes District, Aucklanders accounted for 29.9% of the total searches. This was followed by people located in Christchurch accounting for 16.0% and Queenstown locals for 14.2%. It’s a similar story in Otago, with 29.8% of the total searches performed by Aucklanders, compared to 16.9% by people in Dunedin. “Competition for property is likely high in these regions and will often include international buyers and people wanting to move from other parts of New Zealand or buy as second homes. Given how beautiful these parts of the country are, it is hardly surprising.” “This might be good news for anyone looking to sell in these regions,” says Vanessa.
-Searches per listing divides the total number of searches by the total number of property listings on the site. Engagements per listing divides the total number of enquiries and property saves by the total number of property listings on the site. Both figures together indicate the level of demand for property by measuring the level of serious buyer interest compared to the available supply.