Falling NZ house sales may mean faltering recovery, say economists

Falling New Zealand house sale volumes and prices in January may indicate a domestic economy that's struggling to maintain momentum, according to economists.

Commenting on house sales data briefly put on, and then removed from the Real Estate Institute's website, Goldman Sachs JB Were economist Philip Borkin said house sales tumbled 17 per cent to 4,488 last month compared to January 2009.

The median price fell $10,000 to $350,000 over the same period, while median days to sell remained constant at 36 days.

"The housing market's running out of steam - and quickly," Borkin said. "Again, it highlights the fragile nature of the recovery to date. As a good gauge of domestic demand, the weak housing turnover raises concerns over the sustainability of the recovery to date and emphasises to us that monetary policy support will not be removed before June at the earliest."

To read the full NZ Herald article, click here

Posted: 17 Feb 2010

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