Auckland house sales slump as election weighs on flat market
The volume of Auckland house sales slumped by more than a third in September from a year earlier as an already flat market was weighed down further by the general election.
The number of sales fell to 658 in September from 1,051, the lowest level for the opening month of spring in seven years, Barfoot & Thompson said in a statement. New listings fell 7.9 percent to 1,414, while stock available at the end of the month was 25 percent higher than a year earlier at 3,829.
"The general election coming in the middle of the sales period added uncertainty to a market that has been flat since April and did have an impact on sales numbers," managing director Peter Thompson said. "Factors such as high population growth, stable mortgage interest rates and a shortage of supply remain."
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 today showed property value appreciation slowed even further in September, led by a levelling out in Auckland where average values are still north of $1 million.
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 September 2010, Barfoot had 689 sales and 5,572 houses on its books at the end of the month.
Barfoot today said sales prices had remained static and that they were unlikely to fall significantly due to sellers believing the underlying fundamentals pushing up prices over the past two years hadn't changed. The median sale price of $860,000 in September was 1.2 percent higher than the same month a year earlier, and up 4.9 percent from August, while the average price of $928,213 was 1 percent higher than both a month earlier and September 2016.
"Sellers were prepared to accept prices at close to what have prevailed for the past six months, but have been declining low offers," Thompson said.
The city's biggest realtor anticipates the usual spring pick-up in prices and sales will probably return in early November once a government is formed and buyers and sellers have a better idea about what policies might impact the market.