Housing market comparisons, NZ, Aussie and Canada - ANZ

Analysts at ANZ explained housing conditions in the Candian, Aussie and NZ.

Key Quotes:

"Canadian existing home sales experienced their sharpest monthly fall on record in January, down 14.5% m/m. January marked the first month of more stringent debt-servicing ratio criteria at banks. Timing issues to beat the tougher requirements were likely at play, but the fall well outpaces the December increase (+4.5% m/m).

Here in New Zealand, the housing market appears to have found a floor in terms of sales, and hence likely in house price inflation too. But activity remains 12% below its 2016 average, and in our view, is unlikely to revisit those highs any time soon, with house price inflation to remain modest. And how about Australia, the other market we like to compare ourselves to? Seasonally adjusted CoreLogic house prices fell in October, but have stabilised since then.

Building approvals fell sharply in December, more than expected, but leading indicators such as housing finance for new construction suggest a trend lower is unlikely. In sum, macro-prudential policies appear to be successfully cooling housing markets across Canada, New Zealand and Australia, with the focus now turning to what it will mean for consumption growth going forward."