residential sales turnover
Changes in the New Zealand property market over the last two years are now fairly well documented. House prices rose to a peak in late 2007 following several years of very strong activity. Values then fell throughout 2008 as sales volumes dropped to historically low levels. The market then recovered throughout 2009, although the volume of sales remained below the long-term average. But where have the sales been happening? To answer that we have looked at sales turnover across the country.
Sales turnover is a measure of what proportion of properties in an area are selling over a given time period. We have looked at the turnover of residential properties for 2007, 2008 and 2009. Specifically it is the total number of market sales of residential properties in each year as a percentage of the total number of residential properties in that area. From this we can see which areas have the highest and lowest turnover, and where the changes have occurred.
Looking at New Zealand overall, residential property turnover was 9.9 percent during 2007. This dropped to 5.7 percent in 2008 when the market was dropping in value and sales volumes were very low. The market recovery in 2009 pushed turnover back up to 6.7 percent.
Regions
At the peak of the market in 2007, turnover was an average of 9.9 percent in the urban, provincial and rural areas. During 2008 the provincial areas had the highest turnover at 5.9 percent, urban was 5.8 percent, and rural areas had the lowest turnover of 5.5 percent. When the market began to recover in 2009 turnover was 6.9 percent in both urban and provincial areas, and 6.1 percent in the rural areas.
Looking regionally, in 2007 the highest turnover was in Southland at 12.4 percent, and the lowest in West Coast at 7.6 percent. West Coast at 4.6 percent remained the lowest in 2008, and Marlborough at 7.5 percent the highest, led particularly by the Blenheim area. In 2009 the lowest was still West Coast at 4.6 percent and the highest became Nelson at 7.9 percent.
In 2007 the Auckland Region had turnover of 10.3 percent, but when the market dropped in 2008 Auckland dropped more than any other region in the country to 5.6 percent. However it also bounced back the most from the low to reach 7.0 percent in 2009.
The Wellington Region didn’t drop as much as Auckland, and in 2009 lay slightly below the national average. The Canterbury Region was similar to Wellington in having a moderate drop and subsequent recovery.
Local areas
Across the country there are 73 local council areas. During the peak of the market in 2007, the Selwyn District in Canterbury had the highest turnover of anywhere in the country at 16.5 percent. Most of this can be attributed to new building activity in the suburb of Rolleston which is the main residential development in what is a predominantly rural area. Invercargill had the next highest turnover of 14.2 percent as the cheaper house prices attracted out of town investors. Franklin’s turnover was led by Pukekohe and Tuakau, while Waipa was led by Cambridge and Te Awamutu. The lowest turnover was in Wairoa at 4.1 percent.
In 2008 the market was in decline and overall sales levels dropped to very low levels, leading to the sales turnover rate across New Zealand dropping to 5.6 percent. Selwyn remained in the top five despite the turnover in that area dropping by over 50 percent. The other areas in the top five represent places that didn’t drop as much as others, rather than being areas that necessarily performed strongly. Wairoa, Opotiki and Far North remained in the bottom group, joined by Otorohanga and Westland.
In 2009 the market began to recover, at least in terms of value. Sales volumes increased also, but were still nowhere the levels of 2007. As a result, turnover across New Zealand rose from 5.7 percent in 2008 to 6.7 percent in 2009. Selwyn returned to top spot at 11.0 percent. Waipa also returned to the top five, again led by the towns of Cambridge and Te Awamutu. The Waimakariri District makes the top five, led by strong sales in Rangiora and the new developments in Pegasus. North Shore City makes the top five after being one of the areas to recover the strongest in 2009. Waitomo edged out Wairoa with the lowest turnover. Opotiki and Otorohanga also remain in the bottom five and are joined by Kawerau where turnover failed to recover in 2009.
Compared to the peak of the market, turnover across New Zealand in 2009 was 32 percent down on 2007. The urban and provincial areas are both 30 percent down, and rural areas 38 percent down. On a regional basis, Southland remains the worst off, sitting 45 percent down on the turnover of 2007. The Taranaki Region performs the best at 18 percent down on 2007. Auckland and Canterbury are both 32 percent down from 2007, and Wellington 30 percent down. The best performing main centre is Dunedin where turnover is only 16 percent down from the market peak.
For more information view the full list of turnover for each local area.