Sunday, July 20, 2008

New Zealand house prices plummet

House prices are falling more steeply than official figures suggest, sending household wealth tumbling and curbing consumer spending, today's issue of the Sunday Star-Times says.

The paper says Bernard Hickey, managing editor of interest.co.nz, is predicting that house prices will drop 30 percent during the next two years, as the foreign capital that funded the housing boom dries up, and that prices won't return to the November 2007 peak until 2018.

Since last November, the national median house price has fallen $12,000 - a drop of 3.4 percent, which is equivalent to an annual drop of nearly 6 percent.

The head of TradeMe Property, Brendon Skipper, says properties are taking 20 days longer to sell, and that the average property now stays on the site for 60 days. The number of listings is also declining, he says.

But the rental market is "going gangbusters". In fact, he says, the number of properties listed for rent has increased by 38 percent during the past three months.


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