Auckland house sales drop but prices remain high

Barfoot & Thompson managing director Peter Thompson said "There has been no panic selling"

The Auckland housing market was stable in October despite the political uncertainty, with prices steady although sales volumes dropped.

The number of sales fell to 634 in October from 778 in October 2016, the lowest in an October month for seven years, realtor Barfoot & Thompson said in a statement. New listings dipped 9 percent on an annual basis to 1,733, while stock available at the end of the month was 20 percent higher than a year earlier at 4,451.

"The Auckland housing market has been unfazed by the political change that has occurred," managing director Peter Thompson said. "There has been no panic selling, any hopes of post-election price increases have evaporated, the new government has done no more than confirm its pre-election commitments and buyers are still being cautious making purchase decisions."

New Zealand's property market has been slowing through the course of this year as Reserve Bank restrictions on more highly-leveraged mortgage lending and tighter credit criteria being demanded by banks made it more difficult for borrowers, even as low interest rates made it easier to service much larger debts. Quotable Value figures yesterday showed property value growth slowed to an annual pace of 3.9 percent in October as inflated Auckland house prices fell for the first time in six years.

During the housing market's last downturn in 2009 and 2010, sale prices remained largely static, with the slowdown showing up in smaller sales volumes, longer days to sell, and a build-up in available listings. In October 2010, Barfoot had 561 sales and 5,861 houses on its books at the end of the month.

Barfoot today said the elongated lag between election night and Government formation contributed to the low number of sales in October, and the market "is now well set for an active run into year end" as it enters what is traditionally the strongest sales period of the year.

The median sale price of $830,000 in October was unchanged from the same month a year earlier, and down 3.4 percent from September, while the average price of $910,537 was down 3.5 percent annually and 1.9 percent in the month.

(BusinessDesk)


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The main reason that the housing market is in free fall is because the major Banks have engineered the demise of their customers equity.

New Zealanders need to stand up to their Banks and stop the erosion of their family home value.

Why is this extremely small part of the population(first home buyers) ruling the political regime and STEALING value off the major population of hard working home owner New Zealanders?

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Prices are simply falling back a little to reflect the current supply and demand situation. Long term there is no way that 100K per year increases in Auckland house prices would ever be sustainable. And virtually no houses for sale have had any improvements done to them to justify such massive increases in price.

How would lower equity ever be of benefit to a bank?

Hardly surprising that some people are now worried that they will actually have to work and add value to make money from property instead of just piggybacking on a rising market. A long spell of static house prices will be good as it will allow wage inflation to catch up, without hurting recent buyers. And it will force land bankers to either start developing. Or sell to avoid holding costs. I also own my own home. But I'm nowhere near retirement, so no point in me selling as I would just have to buy again in the same market.

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Correctomundo. If you assume the coalition's logic over time, those same current first time buyers will be massively disadvantaged as they will not acquire enough capital gains to keep up with inflation and have to pay those pesky banks until the end of time. They will also never be able to leave NZ.

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A business acquaintance of my hubby was telling him they have their beautiful Viaduct apartment coming up for auction next week. She said while they were initially concerned about Labor's announcement regarding restrictions on offshore purchasers, the agent has told them there has been a huge upsurge in inquiry from overseas buyers looking to get in before the proposed law is actually passed.

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Average price down 3.5 percent from a year ago, eh?

Interesting time for those who have bought investments recently counting on capital gains then.

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Exactly. Meanwhile, King Canute above is says "nothing to see here!" as the tide begins to lap his feet.

Lots of RE agents going to be lookjng for new jobs in 2018!

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Sean Bedford...jeez,lighten up..."stealing value..." sounds like some one is over leveraged....

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Well the problem is 70% of Aucklanders own their houses - and 30% don't. So if things go dirty, it's gonna be ugly..
Maybe we'll stop hearing the adverts on 1ZB by the opportunists.. what a relief !
[But hey, with a global record of 37% advertising/content ratio they gotta be happy ! ]

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