Auckland's largest real estate agency has recorded its lowest level of March residential sales since the Global Financial Crisis.
Barfoot & Thompson sold just 765 residential properties in March, down by 35% compared to March last year and down 59% compared to March 2021.
March is traditionally the busiest month of the year for residential property sales, but Barfoot's sales this year were down around the levels usually seen in the middle of winter.
The 765 properties sold this year was the lowest number of sales the agency has recorded in March since 2008 when the GFC was getting underway.
The total stock of homes the agency had for sale at the end of March was relatively stable at 4751, down from 4873 at the end of February and slightly down from 4816 at the end of March last year.
However, new listings received during March were up at 1460 compared to 1309 in February, and with sales at such a low level that could push up stock levels further.
Selling prices appeared stable, with an average selling price of $1,102,933 in March compared to $1,101,980 in February, although the March price was down by $131,639 (-10.7%) compared to March last year.
The median selling price was $1,025,000 in March, up by $2000 compared to February but down by $155,000 (-13.1%) compared to March last year.
Barfoot & Thompson Managing Director Peter Thompson said buyers were starting to return to the market.
"Buyer confidence lifted and in the month we sold 765 homes," he said.
"While this is well down on the number of sales we normally make in March, sales were up 86.6% on those in February, and the highest number of sales we have made in a month since May last year.
"The median price in March at $1,025,000 and the average price at $1,102,933 for the month were on a par with the prices paid in February and both figures have shown stability over the past three months.
"Based on these figures, there is greater reason to believe from a price perspective the market has plateaued rather than continuing to fall," he said.
Barfoot Auckland
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67 Comments
Tumbleweeds now outnumber buyers in the auction rooms
^^ old news. The recovery is already well underway...
https://www.nzherald.co.nz/business/barfoot-thompsons-monthly-residenti…
Interesting to note that interests rates are peaking and that the stock of listings now shows a decline.
TTP
What is the internal strategy for price anchoring with property brokers? I noticed the asking price of late 2020 prices locked on all properties for sale by Property Brokers agents.
Twice as many new listings as sales so the ocean of unsold property continues to grow…
Lots have tried to sell and given up - waiting to see what happens later this year,
The question is... will the economy nosedive and job losses mount forcing sales, or will it magically bottom out and prices stablise.
Given recent actions and statement by RBNZ, Govt and Nats... probability favours more job losses and greater house price reductions. Thus we are currently in a calm before the proverbial...
Revisiting this comment - good job OSE
Sure thing, Baghdad Bob.
Peaking? Maybe....maybe not.
Yeah peaking….what the hell is that about.
#Greenshoots bruhz 👍
Inventory for sale is greater now than any time since November 2015. Lots for sale with fewer buyers spells further price falls to come.
Nice Spin. Thats a rise on last months lowest low and miles behind the low of last year and the GFC lows!
What discounts to the apartment sales did it take to get there...
Still haven't peaked, if we take any notice of the RBNZ and the 50 basis point increase today.
A few real estate agents will be looking for new jobs soon.
For real jobs - finally.
"Buyer confidence lifted and in the month we sold 765 homes," he said.
It's almost like he's talking about a completely different month. Spin away Mr Thompson.
Watch the the number of new listings. Low number of new listings (so far) is a good sign that vendors are not in financial trouble (possibly yet). A potential increase in listings will very likely be followed by accelerating prices drops.
18,400 in mortgage stress, up 22% from a year ago. I'd call that financial trouble 'now'. No 'yets' about it.
Watch out for the underemployment and unemployment rates to rocket higher. Companies laying off skilled staff is a last ditch option much like house owners in strife being forced to sell. The longer this downturn with high borrowing costs endures the more likely it all goes thud. Only then will interest rates start to track down.
And the black swan has arrived.
It is chatGPT
This is going to absolutely murder jobs.
UBI here we come.
I've been thinking that too.
During the early days of the COVID-19 pandemic, there were reports of banks granting mortgages primarily to essential workers, such as nurses and doctors, in response to the uncertain economic environment. While this was a temporary measure to mitigate risk, it's interesting to consider the broader implications of AI, which could pose more complex challenges for banks when assessing mortgage risk.
All western countries(excluding Israel) and China are looking down the barrel of a shortage of young people to do the work and support the older generations. Maybe GPT and the other language models will help out and do some of the work. Well, only the white collar work as they can't do manual work yet.
Every new housing loan involves a bank creating brand new money. At the end of every chain of house sales is a seller taking that new money out in cash. The fewer people cashing out per month, the less new money is flowing into the economy, and the lower the consumer demand.
Slowing house sales down, reducing the disposable income of mortgagors, and increasing the cost of business so that many, many people join the dole queue. This, my friends, is how we deal with higher prices in 21st Century New Zealand. Bill Phillips will be turning in his grave at how stupid we are and how much economics has regressed.
The most stupid thing was to have such idiotically and unsustainably loose monetary conditions for way too long. It was so clear to anybody willing to acknowledge economy reality that such low interest rates were simply not sustainable.
Whether the rates were sustainable or not is debatable, but it is true that RBNZ dropping rates to the floor in 2020 was a really stupid idea.
Don' t talk about Adrian, Grant, Jacinda, megan, and Chippy in such a way.
They are across the detail, ahead of the game, fully briefed, and knowledgeable of all the fiscal macinations of our macro/micro economics!
I have faith they will provide a stong stable platform for a complete collapse of the economy in the same vain as GFC.
Bring it on!... lets clear the bullshit fog, the Government waste, and the over priced everything!
"At the end of every chain of house sales is a seller taking that new money out in cash"
That is only the case if the seller doesn't have a loan, for those that do, they will need to repay the mortgage on the house sold, which will cancel out the creation of money you refer to, at the beginning of your post.
At the end of many housing sales chains are people moving into retirement properties or families selling up after a death - the cycle of life. With supply limited, you can't have a thousand first home buyers a month, without almost a thousand people cashing out.
Displaced workers won't join the Dole Queues. They'll retire instead.
That what happens when you have an inverting demographic pyramid (as we do) and there aren't the young replacements for those that quit the workforce.
What's the average age of our farmers, for instance? In the USA it's 60 and rising ( who wants to be a young farmer when you can be a YouTube star instead?!), and I'll suggest the same probably applies here.
Who is going to grow our food when the current crop of farmer retires? And the answer in the longer term isn't - Immigration, for all the reason you'll be well aware of.
Unemployment (that won't materialise) is the least of our problems.
Being a farmer might make you a YouTube star. Or is it just me who has been watching too many "grow your own food" videos to cope with the cost of living lol
Some of the farmers/Youtube stars are said to be making more from Youtube than they do from farming.
Popular channels such as MNMillenialFarmer and Welker Farms are said to be near $1million USD in Youtube revenue alone, plus merchandising opportunities and commissions on top of that.
"Based on these figures, there is greater reason to believe from a price perspective the market has plateaued rather than continuing to fall," he said.
Hmmm
Irish Auctioneers & Valuers Institute president Robert Ganly commented: "Overall, I would say to people that the market is beginning to stabilise. The worst is over."
He said that the absence of further rises in interest rates and the reformed stamp duty regime to provide some support, alongside "strong latent demand from young couples who put off purchasing in 2007".
While prices would continue to fall in 2008, "this levelling off should begin to reverse itself in early 2009, and we would hope to see the property market growing again some time during that year".
Yep, and it kept falling until 2011 then flat for a few more years. Will be the same here. With twice as many new sellers as new buyers in traditionally the strongest month the only way is down for a while longer yet
5th Apr 23, 5:00am by Greg Ninness - "The CoreLogic figures also suggest that the rate at which dwelling values are declining is increasing"
5th Apr 23, 10:42am by Managing Director Peter Thompson - "Based on these figures, there is greater reason to believe from a price perspective the market has plateaued rather than continuing to fall,"
Any guess who's in denial here? A still falling sales rate points to even steeper declines to come - that's it.
One of those people promotes investing on Interest, the other promotes vested interests.
Int.co keeps me sane. Almost MSM now but still being real.
Quality articles with real data and fairly balanced narratives focused on the facts at hand, and a lot of mostly quality comments.
Interest.co.nz helped family members ID the leading indicators and make good investment decisions, even when FOMO pressure was much more intense. Worth a monthly sub
Yep, big help to my young uns too. The fomo was on them but by checking in here it gave them the confidence to hold out. Instead one built a business from scratch and they and partner private board with friend who is under huge financial stress from mortgage etc.
News outlet of the year.
Be Quick!!!!!!!
Sales lowest since 2008, OCR about to be at a level last seen in 2008. Quite a few parallels to the GFC can be drawn at the moment.
There are lots of parallels - so many indicators are now at levels last seen in 2008/09. And, yet...
I would also suggest 1929 might be of comparative interest too..
"There may be a recession in stock prices, but not anything in the nature of a crash."
- Irving Fisher, leading U.S. economist , New York Times, Sept. 5, 1929
Don't leave us hanging Jfoe...
In 2019 there were 8250 divorces granted in New Zealand. That averages out to 687 a month. Should put a floor on the sales numbers.
100%, this probably excludes de facto separation agreements as well which could push this a LOT higher,
Seeing marriage %'s have declined massively in the last 50 years (1971 = 45.5/1000 down to 2022=7.7/1000 = 83% decline), which is currently very close the recorded 'divorces' at 6.2/1000 (Stats NZ)
Marriage (or de facto) is a VERY bad idea for men...(or the higher earner) with family law as it is...
There's a reason it's the #2 highest stressor to people, and one of the main triggers for male suicide which is 300% higher than females, the highest risk is youths<24 and 45-64yo males
Men really don't understand the contract they are entering into when going into marriage... (at least 50% will fail, and the cost is high)
Women initiate ~70-80% of divorces and family law has become a feminist institution in which the outcome typically sends money to women
Be prepared to get sc$%^#$ over badly if you go through it and lose at least 50% of what you worked hard for, including kiwisaver, house, business, Everything....
As well as be on the hook for possible spousal support - taking from your future income
Somebody forgot to set up a trust
Trusts are not immune... look up 'relationship income' (unless it's foreign and even then....) neither are pre-nups... which lose value over time
Like I said... the law in practice favours the lower earner which is typically the women initiating divorce
BTW this happen in de facto relationships as well - you are defaulted into a 'marriage' contract if you live with a spouse for 2-3 years in the states eyes
Live with a guy 2-3 years = entitled to 50% of everything they have, directly or indirectly benefit from
Trusts don't protect you from getting dragged through the Family Court system and having access to your children cut off (often just to maximise the amount of Child Support awarded...)
Marriage isn't the bad idea, choosing the wrong partner is.
Hindsight is 20/20 and peoples relationships change - clearly you haven't been through it.... yet
Round two... ding ding
You sound like a (divorced) woman I knew years ago who told me I'd never marry my girlfriend because reasons.
I witnessed it in the dissolution of my parents' marriage when I was a child. They got married at 21 and stuck it out for 15 years before finally calling it quits. Even at a young age I could see they weren't right together, they had nothing in common except us kids.
I've known my wife for 27 years now, and we've been married for 17. Our marriage is rock solid because we didn't jump in without testing the waters first.
For what it's worth, I'm mid Gen X, my parents are early Boomers.
Morbid, but 39000 people died in 2022, if say 1/4 owned property that gets sold as part of their estate, that would be 800 per month
800? Get real. "Get Rich from Real Estate" kicked in a decades or so back for many of those that die today, and just having 1 home wasn't part of the retirement plan.
There's likely to be some meaty holdings coming to market from just a solitary disbursement, and many of the properties won't be of the calibre that the beneficiaries want to live in themselves.
probably not. most of those dying probably went through their nest egg years ago, and have been living on super for some decades - having well outlived the life expectancy of their working years.
Only an anecdote, but the 4 still living nonogenarians in our family have all long sold their holdings, and are living out their final years courtesy of Ryman et al. And where did that money go? The dead partner's care expenses for their final years.
Regardless of whether it's sold after death, or a few years before, the number will be roughly proportional to the number of deaths per year as that number doesn't fluctuate that much
Who cares what Barfoot reports, they're real estate agents and this is just free marketing
Brand awareness - maybe it is hardly encouraging anyone to sell or buy.. Thus they are probably losing tons of revenue, profits and trained staff.
They need evidence of green roots > maybe next month if they sell an extra house than this month - they can claim that sales are increasing month on month.
Meanwhile Anne Gibson (described as a "a skilled and knowledgeable journalist with deep insights into property") at the Herald:
Barfoot & Thompson’s monthly residential sales up 86 per cent, home buyer confidence back
Herald = Hoodwinked
That description - lol!!! 😂😂😂😂
peter thompson said buyers were starting to return to the market --- what as sellers ??
Feijoa are cheap currently. Feijoa on toast for all the REs...?
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