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Barfoot & Thompson reports listings at an all time low, despite sharp increase in new listings in July; median price drops by NZ$5k to NZ$585k

Posted in Property Updated

Auckland's biggest real estate firm Barfoot & Thompson says its listings in July fell to an all-time low, despite a big rise in new listings during the month.

The median price fell by NZ$5000 to NZ$585,000, while the average house price rose to NZ$654,379, an increase of  over $4,000 on June’s average price.

Barfoot & Thompson is much Auckland's largest real estate firm, accounting for around 40% of sales.

During July the company saw a 37% increase in listings compared with the same month ago and had its second best month for new listings in 2013. But it also had its best July for sales since 2005.

Westpac senior economist Michael Gordon said the 17% increase in new listings during July relieved "some of" the recent constraint on sales growth.

"Even so, the total number of listings continues to dwindle, which points to an ongoing upward squeeze on prices," he said.

July sales rose nearly 6% in seasonally adjusted terms, he said.

"The number of sales was the highest so far this year, though they were still slightly below the peaks seen in late 2012."

Gordon said while the jump in listings during the month was "notable" this was arguably a catch-up after two months of below-trend listings.

"The additional supply seems to have been more than fully absorbed by demand, with the total number of available listings running down to yet another record low," Gordon said.

"Figures provided by Realestate.co.nz show that listings are declining in almost every region of the country. The nationwide stock of unsold homes in July was down 14% on a year ago, with Auckland seeing the most rapid decline (down 28%). The average sale price was broadly flat in July. However, the annual growth rate rose slightly from 10.3% to 10.6%."  

The 1133 sales during the month by B&T - an increase of 7% on the June figures - saw overall available listings drop to just 2837, which is the lowest ever for the firm and down some 29% on the number of houses it had available at the same time last year.

It was the fifth month in a row that B&T has topped 1000 sales - and managing director Peter Thompson said the the last time sales were this "consistently high" was in the first half of 2004.

“Competition for properties in Auckland remains strong, but the sales figures indicate that buyers have a keen sense of a property’s value and are keeping a level head when it comes to prices." 

During July Barfoot & Thompson sold 439 homes for less than NZ$500,000, and a further 356 for between NZ$500,000 and NZ$750,000.  A total of 152 homes sold for in excess of NZ$1 million, eight more than were sold in June.

The latest figures from B&T bear out other evidence that the recent sharp rises in house prices, particularly in Auckland, have now started to attract more sellers into the market.

However, the overall heat in the market has been causing the Reserve Bank concern and it has been making noise about potentially putting "speed limits" on high loan to value loans. See here for articles on LVRs.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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14 Comments

A close family friend just

A close family friend just sold their house to move south.  They initially listed in June 2012 but the buyer couldn't come up with the money.  They listed again few weeks ago and sold it last week for about 100K more than last year.

CM ...thank you for your

CM ...thank you for your post, as the more I hear stories like that, the more inclined I am to sell my central Auckland property and add those funds to my USA portfolio ....sounds like Auckland is definitely in "bubble" territory now .........whether it be a "pop" or a "fizz" scenario....
Besides,  the NZD is only going to continue trending down against the USD ...so a "double whammy" .....capital appreciation in the US market plus appreciation from an NZD perspective.
I truly do not understand how these Auckland landlords think they can continue to raise rents, with no slowdown of tenant demand....if rents get too expensive, the tenants will just cram more people into the same property.

Buying in the US.. I hope you

Buying in the US.. I hope you have a big strong pair below (like a horse).  Detroit is dirt cheap, waterfront home with 5br, swimming pool can be bought for around 3-400K.. but I don't have the ability to grow bigger bxlls.

Yep ladies and gentlemen...

Yep ladies and gentlemen... life's still good in Landlord land.
 

As long as we can buy and

As long as we can buy and sell houses to each other, taking on more and more debt right YL? :D

Hi Muppet. You don't have to

Hi Muppet. You don't have to buy a house... you can always rent one.
Do you know, us Landlords are very efficient at providing housing.

CM ....the US property market

CM ....the US property market is a HUGE market .... each area/market is totally different.
I wouldn't even dream at looking at some places in the US......and yet again in many of the metro areas, property is way, way more expensive than Auckland  !!    
Just like anything else, you just need to do your homework.

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True supply shortage or

True supply shortage or controlled inventory 'adjustment.'At january 1st Barfoot and Thompson had 3410 listed properties. To the end of July Barfoots listed an additional 10332 properties.All things being equal 13742 properties (including 1628 listings for July). During this period Barfoots sold 7680 properties which would equate to 6062 current listings.Yet it is  the headline number of 2837 to feed the housing shortage/inventory shortage meme. Put another way Barfoots has listed this year  thirty five percent more homes than it has sold. Consistent with a shortage ?

Howdee Ostrich, great

Howdee Ostrich, great observation ....you are on to B&T - the masters of Auckland property spin.

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What if Fonterra scandal is

What if Fonterra scandal is the trigger for lower NZ$, higher foreign banks interest, higher unemployment, mortgagee sales, etc....?

Get ready for the fear

Get ready for the fear selloff 5, 4, 3, 2...

stuck on 2? More like a

stuck on 2? More like a countdown to a take off rather than a sell down.