By Bernard Hickey
Auckland's biggest real estate agency group, Barfoot and Thompson, has reported an 18.6% fall in sales volumes in October from September, but says average prices held up despite a 16% rise in new listings.
Sales volumes of 561 in October were down 36% on October a year ago and below the 583 reported for January this year. However they remain above the recession low of 503 in October 2008.
About a third of all property sales in New Zealand are from Auckland, with Barfoots' market share in Auckland around 41% in September. Barfoots was responsible for about 16% of sales nationally in September. It is the first group to report sales and price data for September October.
Barfoot and Thompson said sales in October fell to their lowest level in 20 months, but the average price, at NZ$524,004, was in line with September's average price of NZ$523,861.
“Normally when there is a large decline in sales, prices often retreat. However, prices for the past two months have gone against that trend and have remained between 2 and 3 percent higher than August’s average price of NZ$510,978," said Barfoot and Thompson Managing Director Peter Thompson.
“This year the spring boost in housing activity has been slower to start, but in the last few weeks of the month new listings have increased significantly, and this normally precedes a lift in sales," he said.
“October’s average price is also only 3.8 percent lower than in October last year when the market was already on the rise in the lead up to Christmas.”
New listings at 1,396 in October were up 16% on those for September, bringing total listings to 5,861 at October 31, up 5.2% from a month earlier.
“New listings create new interest in the market, from both those that are actively looking, and those that are thinking about their next move," Thompson said.
"This level of choice, the availability of bank funding at historically low interest rates, and stable prices are all criteria that lead to buyers being prepared to commit to a purchase,” he said.
Record weekly rent
Barfoot and Thompson said average weekly rents rose NZ10 to a record high NZ$417 in October, up from NZ$403 a year ago. The average was from 697 properties, which was 20 less than rented in September.
"It points to the market price lifting rather than the increase being due to a shortage of properties. Rents have risen as landlords seek to improve the operational return they receive from their investments," Thompson said.
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