Corelogic reports shows first increase in home sales since 2021

The number of home sales in New Zealand increased by 7.5% in May 2023 compared to the same month last year. This is the first annual increase in sales transactions since May 2021. CoreLogic, the company that released the data, says that it looks "more certain that sales volumes have finally bottomed out".

However, new listings over the month of May remained at -28% below the same time in 2021 and -20% below the previous five-year average. This suggests that the market may still be some way from a full recovery.

CoreLogic's chief property economist Kelvin Davidson says that the annual increase in sales is "welcomed news" but that it may be too early to "emphatically call it a new trend". He says that the market "may be approaching a trough" but that it is "still too early to say whether this is the start of a sustained recovery".

The Reserve Bank of New Zealand (RBNZ) has been raising interest rates in an effort to cool inflation. This has had a knock-on effect on the housing market, with house prices falling. The RBNZ has said that it expects house prices to contract by a total of 23%.

It remains to be seen whether the recent increase in sales is a sign of a sustained recovery in the housing market. However, the data from CoreLogic suggests that the market may be bottoming out.