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Real estate agents say it's a sellers' market: BNZ survey

More potential house buyers are attending open homes and real estate agents rate it a sellers' market, according to the Bank of New Zealand's latest survey of more than 10,000 agents.

By Jenny Ruth

Seven of the eight measures BNZ's monthly survey tracks were stronger while the eighth, a net 13% of agents who say they are receiving fewer requests for appraisals, points to the shortage of houses available for sale. This backs up the data which measure more than 95% of New Zealand house listings.

“With interest rates set to stay low for this year and perhaps all of next while economic growth continues at a reasonable if unexciting pace, New Zealand's residential property market is likely to remain in its sellers' market phase at least well into 2014,” says BNZ chief economist Tony Alexander.

The risk is economic growth will be lower than the central bank expects and so there's a chance it won't raise its official cash rate (OCR) in 2013 or not until late that year, he says.

“Beyond that depends very much upon what at this stage are unpredictable interest rate rises further out and by how much dwelling supply can grow in an environment where builder shortages seem certain to appear,” Alexander says.

A net 18.3% of agents rate it a sellers' market, up from 15% last month – that's the difference between those who do and those who don't – while a net 41.1% are reporting rising prices.

A net 26% report more people going through open homes, up from a net 13% in June, “a sign that buyers are out in force,” Alexander says.

“A record net 27.9% of agents say they are noticing more investors in the market while 44%, up from 40% in June, say they are seeing more first home buyers.”

Part of the recent jump in investor demand reflects the sharp falls in mortgage interest rates in May, he says.

Alexander says the fewer appraisal requests “is suggestive of vendors feeling in no particular hurry to list their properties.”

The survey found a record net 28% of agents reporting auction clearance rates are rising, another sign of a strong market.

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