Households 'under siege', BNZ economist says
RNZ
New Real Estate Institute (REINZ) data showing a weak housing market, particularly in Auckland, is further evidence of the "air pocket" the economy hit in the middle of this year, one economist says.
REINZ has released its data for July which shows seasonally adjusted sales counts at a national level were down.
The House Price Index
, which smoothes out variations in the median sale price, was up 0.1 percent year-on-year on a national basis but down 0.4 percent on the month before.
For Auckland it was down 0.1 percent year-on-year and down 1.8 percent month-on-month.
Papakura values were down 5.2 percent compared to 2024, while New Plymouth's were up 4.9 percent and Invercargill's 7.8 percent.
BNZ chief economist Mike Jones said he had been looking at the numbers to validate or disprove what looked like a "stumble" in the housing market in June.
"It looks like if anything the housing market was a little weaker again in July so it does appear that markets have lost some of that relatively modest momentum that was there and it's faltering a little bit."
He said Auckland was noticeably softer than the rest of the country, particularly the South Island.
"The unemployment figures we got last week and now the housing market as well - it just kind of adds to all those other signs and evidence we're getting in the economic numbers that the country hit something of a wobble or an air pocket in the middle part of the year."
He said the labour market had weakened and cost of living pressures had intensified. "Food prices in particular are putting extra pressure on the household budget. At the same time, as it was pointed out last week, wage growth is cooling down so in some ways it feels like the average household is sort of under siege at the moment. That's causing faltering demand across a lot of different areas of the economy and the housing market would be one."
ANZ's economists noted that house prices were now 0.4 percent above their most recent low in October 2024.
"Given recent weakness in the market, we see some downside risk to our forecast that prices will end 2025 up 2.5 percent year-on-year. We remain of the view that three further cuts in the OCR will be needed to shore up the economy and stabilise inflation around the Reserve Bank's target midpoint. Lower interest rates and a cyclical recovery are likely to see the housing market gradually strengthen over the next year, but we don't expect prices to race away."
Westpac senior economist Michael Gordon said the market was unusually well balanced.
"While lower mortgage rates have helped to spur higher levels of activity compared to a year ago, demand is being matched by an ample supply of homes hitting the market. As a result, there has been little upward pressure on sale prices.
"House sales were down 2.5 percent in seasonally adjusted terms in July, the third straight monthly decline. The number of sales is typically understated on the first release, so we expect that this will be later revised to around flat. Sales were up 4 percent on a year ago; it was around this time last year that the level of activity in the market took a marked step up, so year-on-year comparisons will look less impressive from here on."
When seasonally adjusted, the house price index was down 0.5 percent in July and down 1.2 percent in Auckland, Gordon said.
Sign up for Ngā Pitopito Kōrero
,
a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
RNZ News
22 minutes ago
- RNZ News
Can my father's partner take his house?
RNZ's money correspondent Susan Edmunds answers your questions. Photo: RNZ Got questions? RNZ is launching a new podcast, No Stupid Questions with Susan Edmunds, next month. We'd love to hear more of your questions about money and the economy. You can send through written questions, like these ones, but - even better - you can drop us a voice memo to our email questions@ What happens if my father owns a house, but now has a partner for several years who moved in to the house and has put the power in her name to prove she's lived there for a certain time. If my father dies before her with no will, will she get the house or us kids? Justine Wood is a specialist trustee at Public Trust and helped me answer your question. Basically, when someone dies without a will, it's referred to as "dying intestate". That means specific legislation comes into play that determines who will get which bits of the person's estate. That means the partner may well be entitled to a share of the house. "Based on the family circumstances you've outlined, the partner may be entitled to receive the personal chattels, such as vehicles, furniture and jewellery, the first $155,000 of the estate and a third share of the remainder of the estate," she said. "This will depend on the couple meeting the legal criteria of having a de facto relationship at the time. The remaining two thirds of anything left would be distributed equally between his children. "Administering an estate when there is no will can be costly and take longer to sort out. Having a will helps your family understand what you'd like done with your estate after your gone - and it makes the process of managing your passing less stressful on loved ones." The Administration Act defines de facto relationship in line with the Property (Relationships) Act. This said a de facto relationship is a couple who are at least 18, living together as a couple and not married or in a civil union. Things that might be taken into account are the duration of the relationship, the nature and extent of common residence, whether there is a sexual relationship, the degree of financial interdependence and dependence, ownership of property, the degree of mutual commitment to a shared life, the care and support of children, performance of household duties and the reputation and public aspects of the relationship. It would make sense for your father to draw up a will. Even with a will, his partner may have rights under the Property (Relationships) Act - they may need to sign a contracting out agreement if he wants to ensure that the property is left to you. Are there any disadvantages in keeping KiwiSaver funds there in KiwiSaver after retirement age? Is it best to fill the forms now and take some, if not all? There really is no disadvantage to leaving your money in KiwiSaver once you're retired, if that's what makes the most sense for you at the moment. It would be a good idea to get some advice on the funds your money is invested in, though. Depending on how much you've got in your KiwiSaver, it might make sense to divide it up and invest it in a few different funds. You might have some in a conservative or even cash fund that you can tap into if you need it in the near term, for unexpected bills or things like that, some in a balanced fund for the medium term and then some money in a growth fund for the longer term. The growth fund will probably bump around a bit but should deliver better returns overall, which might help make your money last longer through your retirement. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
RNZ News
10 hours ago
- RNZ News
Who pays when a supermarket price tag is wrong?
A Whanganui SuperValue displayed some dodgy maths recently, with the price per 100g not adding up to the main price shown. Photo: Supplied When a Whanganui SuperValue displayed some dodgy maths recently, shopper David Bradbury argued he should have been able to choose to pay the lower of the prices on offer. He spotted bacon that was advertised as selling for a different price per 100g than the main display price. Shoulder bacon was 200g for $4.69 but then 94c per 100g, and middle bacon was 200g for $5.79 but $1.16 per 100g. "I pointed out to the closest person in a shop uniform the poor arithmetic ... He said the big number was the right one. I said I should be able to choose. He said no." A SuperValue spokesperson said the unit price was incorrect . "On our pricing tickets customers will find the price of the item and a unit price which enables them to make an informed decision of value based on the unit of measure. "In this instance, the unit price was incorrect on the 200gm Grandpas Shoulder Bacon and Middle Bacon products. The price was however the correct price the customer would have paid at the apologise for the error and any confusion caused. "We know how important it is that all of our tickets are accurate and we have now corrected the pricing tickets to reflect the correct unit price." Vanessa Horne, Commerce Commission general manager, competition, fair trading and credit said she encouraged him to report the concern so the commission could assess whether the shop was complying with the laws it enforced. "The trader could be prosecuted where there is serious non-compliance with the Unit Pricing Regulations. "The Unit Pricing Regulations are there to help consumers easily compare products based on the price-per-unit and make informed choices about which product offers them the best value." She said the Commerce Commission had ongoing investigations into supermarket operators . "We have recently filed criminal charges against Woolworths NZ, Pak'nSave Silverdale, and Pak'nSave Mill Street for what the Commission alleges was inaccurate pricing and misleading specials that may have breached the Fair Trading Act. "Supermarkets have long been on notice about the importance of accurate and clear pricing and specials, and we're not satisfied with the continuing issues we're seeing across the industry. "The major supermarkets are large, well-resourced businesses that should invest the time and effort to get pricing and promotions right." Consumer NZ spokesperson Sahar Lone said a supermarket that displayed incorrect unit pricing could be breaching the Fair Trading Act. "If you notice an incorrect unit price, point this out to a supervisor in store. The store has the right to correct its pricing mistakes. If it doesn't sort the issue, or it's widespread, you can lodge a complaint with the Commerce Commission." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
RNZ News
20 hours ago
- RNZ News
Air New Zealand's online payment system down
A Boeing Dreamliner 787, from the Air New Zealand fleet. Photo: Supplied/ Air NZ Air New Zealand customers are unable to make online bookings due to a problem with the company's online payment system. "We are currently experiencing an issue with our online payment systems," the airline said on social media. "Customers can't make payments for bookings through our website or app." Air NZ said in-person payments at airports and the Airpoints Store are no affected. "Our teams are working hard to fix the problem and get things running again as quickly as possible," Air NZ said. "We apologise for the inconvenience and appreciate your patience while we work through this." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
