Houses listed for sale in Auckland are at their lowest point in at least four years, based on data interest.co.nz tracks from RealEstate.co.nz and Trade Me.
Interest.co.nz's weekly index tracking listings on the two websites gives a reading of 65.897 today, continuing a steady decline since March. Interest.co.nz has been tracking property listings on the two websites since March 24, 2008, when the index started at 100. (See chart below).
The drop in house listings in Auckland comes with Barfoot & Thompson, Auckland's biggest real estate agency, reporting its new listings fell in April, down 17.6% to 1,266 from 1,537 in March. Total listings were 4,621 at the end of April, down from 4,771 at the end of March and down from 5,580 at the end of April a year ago, Barfoot & Thompson said. See our report on Barfoot's figures for April here.
The latest Real Estate Institute of New Zealand (REINZ) monthly figures, also for April, showed Auckland recorded its highest number of sales in an April month since 2007, although the April 2012 total of 2,157 sales was still well below April 2007's 2,843. The median Auckland price fell by NZ$5,200, or 1.1%, from March's record high of NZ$495,200.
And the stratified REINZ Housing Price Index for Auckland, which provides an averaging of sales prices for common groups of houses and was developed in conjunction with the Reserve Bank, was at a record high in April, 2.3% higher than a previous peak in July 2007.
Meanwhile, in April the Productivity Commission called for both the development of greenfields sites and moderate-density brownfields development to lift the number of houses on the market in and around Auckland and to help alleviate housing affordability problems.
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17 Comments
Go SK ... you should be salivating at the mouth at this great news ! ... you know the mantra by now ...supply down, prices up !
I truly hope the prices in central Auckland just keep rising and rising.... the higher they go, the greater the fall .... but I would say you have never experienced that yet ?
That is just what I am saying .... residential house prices are based on supply and demand, as we both know.
However in NZ it is a "flawed" one regarding the rental market, that is subsidised by the accommodation supplement, WFF (middle class welfare) and tax breaks for residential landlords ....even if you just took one of those away, you would see a "shift" in your rental income SK ... and I didn't even mention the "other" that will never happen in NZ anyway (too many vested interests) .. a capital gains tax.
The reason I am against how residential property is structured in NZ, is that the regular taxpayer is subsidising your rental income with the above and I truly believe in a "free market" with no government interference in the rental market.
So in reality this government (and previous others) have the banks dictating to them to keep property prices higher, so the banks will stay in a profitable business. The banks are so scared of a property price drop, the government have to "top up" peoples income to pay their rents......or in other words "keep the ponzi scheme going"
I have always said, it is the banks that are getting the last laugh .... their profits tell the story.
BTW I am definitely not "anti-property", I have a residential property in central Auckland returning 14.2% pa gross but the return on Auckland property now is pretty dour and I would not even look at a property until I could get at least a 7% pa gross return.
Noticeably Housing New Zealand have thrown a few properties on the market recently (properties that may would be surprised HNZ owns like villas in Grey Lynn (2 are up for auction in the next couple of weeks) and the more obvious ones in Remuera (and I'm sure plenty more in other areas).
Housing NZ should have a policy of disposing of most of its expensive inner Auckland property over say a 10-15 year time frame. Adding on average 100 houses a month to the supply would have endless benefits not to mention raising perhaps $60m a month of which half could go to the Govt as revenue ($30m) and the other half spent on building new fringe houses of which about a third of that ($10m) would return to the Govt as tax revenue, plus of course the new spending encouraged by the rebuilding or redevelopment of the recently sold state houses could be a further $30m of which $10m would be collected in tax revenue.
So there's a policy that would generate $50m in revenue per month, plus supply more brand new high standard state houses than the had old ones, plus keep a lid on house prices in Auckland!
I utterly agree with your thoughts on this Chris J. Most HNZ homes in central Auckland are deteriorating significantly. Selling them will loosen capital to build new, energy efficient state housing plus allow new owners to do the necessary maintenance &/or upgrading to some of these neglected old gems. And as you say, the Govt get back a ton of all this in tax (GST on the newbuilds etc)
And now the capability has been stripped out of the Building Industry supply is going to get even thinner.
Over 2000 kiwi builders now reside in NSW and QLD, not only because of the higher wages but they can get up each day and actually practice their trade.
The one thing that is going to be sustainable in the future is sustainable demand for housing, the lag in build time 5months defies any change.
the thin vineer of supply is gobbled up by thick hungry demand and demand is now higher than supply can or will be able to meet in the foreseable future.
99% of new builds are for owner occupiers , so where is the new rental stock going to come from.
The rate of decay has started to hit hard also at 2.5 homes per thousand, look at all those state homes decaying over 60 years old.
Fundemantal capability has been lost, i can only imagine what hoops the Government would have jumped through is Dairy halved, or tourism or Banking or Manufacturing.
More kiwis move to Australia on a daily basis, kiwi builders are building them homes as they arrive.
What is being done, actually being actioned in regard to building Affordable Housing,,,Please not another report on what we should be doing, at some stage you gotta put away the pens move out of the cubicle , pick up a hammer and nails and begin...
QLD has a $10,000 builders boost for construction of a new home and a fist homeowners grant,
New Zealand has ..... oh councils salivating how much they can rip the project before we get a spade out...
Seriously what is being done...?
Also couple all of the above with the leaky homes saga that will go on for at least another ten years of re-cladding and the stigma attached to those homes.
Crippling!
Before homes become an asset clas they are fundementally shelter from the elements, so not really a luxury item more a neccessity for a country with ambition to grow....and house its population?
Low listing mean high prices. Not neccessarily.
Maybe it means houseowners read the low prices. And decide not to list as a subsequence.
And that situation is also reinforced by decisions just hang tight and reduce debt.
Realtors don't care what prices do. But they will do anything they can to talk up turnover.
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