The Reserve Bank’s cut in interest rates last month appears to be stimulating activity in the housing market.
Figures from the Real Estate Institute show nationwide sales rose from $1.29 billion in February with 6,182 homes sold to $1.39 billion in March with 6,659 homes sold.
`The institute has been anticipating that sales volumes would begin to rise, and the latest figures indicate that the New Zealand public are beginning to take advantage of the current lower interest rates available,’ says Institute president Rex Hadley.
Still, the housing market is still relatively subdued. There were 93 fewer homes sold in March compared with March last year. The national median house price rose only slightly from $173,500 in February to $173,800 in March, well below the March 2000 median price of $175,000.
Eight of the 11 regions saw sales increases compared with February and the median price rose only in five of the regions.
The central bank cut its official cash rate from 6.5% to 6.25% on 14 March. It cut the rate again today to 6%.
