The sales rate was around 50% at all of Barfoot & Thompson's main auctions last week

The sales rate was around 50% at all of Barfoot & Thompson's main auctions last week

Barfoot & Thomson achieved sales on half the properties it marketed for sale by auction last week, although the total number of properties being auctioned remains low.

The real estate agency, which is the biggest in Auckland, marketed 81 residential properties for sale by auction last week and achieved sales on 41 of them. That gives an overall sales rate of 51%.

Of the 41 properties that sold, 33 sold under the hammer, five sold prior to their auction and three sold immediately after their auctions.

The notably higher sales rates was evident throughout Barfoot's auction rooms with all of the major auctions achieving sales rates in the 45% to 56% range.

The only outliers were three smaller auctions where just one or two properties were offered and the sales rates were either none sold or 100% sold (see table below).

So although there wasn't a lot to choose from last week, buyers were out and about and were prepared to bid if they found a property that suited them.

The comment stream on this story is now closed.

Barfoot & Thompson Residential Auction Results 9-15 September 2019
Date Venue Sold Sold Prior Sold Post Not sold Postponed  Withdrawn Total % Sold
9-15 Sept On-site 2           2 100%
10 Sept Manukau 5 1 3 8   3 20 45%
10 Sept Shortland St 4     3 1   8 50%
11 Sept Shortland St 13     12 1   26 50%
11 Sept Pukekohe 2     2     4 50%
12 Sept North Shore 6 4   6 1 1 18 56%
12 Sept Shortland St       2     2 0
13 Sept Shortland St 1           1 100%
Total All venues 33 5 3 33 3 4 81 51%

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71 Comments

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10
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copy and paste comments from last week....... now

No comments would be even better!

Lead by example :)

"This proves everything is stable and there is a Spring bounce!" or "This proves everything is terrible and estate agents must be starving to death!"

Commence the 120 comment argument.

Havent heard anything from Yvil yet?

Maybe he cant pay his power bill anymore, now that his commission has dried up!

Umm.. Yes not even TTP either? Looking at the auction sales and price figures there's not much to crow about in the results.

These articles, and the comments, do feel a bit 'Groundhog Day"-ish don't they?...

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The article doesn't compare CVs to sales prices this time for some reason. I went ahead and looked through the first page and calculated it myself, out of interest. I looked only at the Barfoot and Thompson sales for Auckland, and only the first page of results, to be clear.

There were a total of 21 properties where the comparison could be made. 6 sold above CV. One sold for exactly CV. The other 14 sold for below CV. In percentages, 66% went below CV, while 28.6% sold above CV.

In total, CVs were $779,500 higher than sales prices, averaging out to a difference of about $37,000 per property.

Must have been another rainy week.

Nah, just wait for the narrative revision for this who find it inconvenient......

Or just the usual "Vendors ready to meet the market can sell at a good price! It's a great time to buy!"

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"Must have been another rainy week"

You reckon its rain or tears???

Data can be presented to suit one's vested interest.

Assuming that's not a non-sequitur and you're criticising how I presented the data, how would you do it?

No slight on the artical. Thinking that what people are looking at is properties sold above / at / below CV's.
There's a comment above that works it out to be 60% plus below CV sold. The last couple of weeks have worked out to be 50/50 so we are seeing a plus 10% slip in prices.
It would be interesting to do a comparison over the years as it wasn't that long ago that not many if any sold below..

You might be responding to the wrong person? The "comment above that works it out to be 60% plus below CV sold" you're talking about is mine.

Replying to GGP. He was asking about what he could do with the artical.
66% below is a shocker, 50/50 the last while.
The headlines should be 'Sellers lower expectations 66% sold lower than CV!!!'
That's a 16% increase since last week......

Have noticed in my area - Auckland Eastern Suburbs - an increase in properties for sale in the $2m plus price range. Out of roughly 30 new listing all are in this price range with the exception of a couple of 2 bed units. There is a fairly even spread those going to auction and those not with 1 tender thrown in where the owner purchased in 2017. Will be interesting to see what happens over the next month.

Also a question for any agents out there.... why are people selling? Upsizing, downsizing, moving out of Auckland/Overseas

Why people moving overseas?
Because for 1.1 mil I can get this massive home in Aust where as for the same price I'd be lucky to get a 3br unit in Ponsonby. Btw this home is about 4-5 km from the CBD!
https://www.domain.com.au/61-gower-street-toowong-qld-4066-2015526232

forgot the link :)

The cheapest unit 3br unit in Ponsonby is like 1.5 million. Maybe not the best suburb example.

@chairman Moa - Did you just really make that comparison? Auckland is NZ's largest city. If you want to compare it to Aus, compare it to Sydney. Can you find anything similar close to the city in Sydney for 1.1m? I don't think so. Brisbane is probably more comparable with Wellington or maybe even CHC.

@Iceman, Auckland population is even less than Brisbane. it's only marginally larger than Adelaide. Compare to Sydney, Auckland would be like a hick town! (Sydney 4.67 millions, Melbourne 4.9 mil, Brisbane 2.28 mil, Auckland 1.65 mil, Adelaide 1.32 mil)
Btw, have you spent much time in Sydney or Melbourne? I lived in both Auckland and Sydney.

@chairman Moa, it's not about the population, it's about the jobs and opportunities. I have lived in Melbourne and been to Sydney a few times. Sydney is the financial capital of Aus, while Auckland is that of NZ. Comparing population is irrelevant if you are talking about house prices in inner city suburbs. They are not fair comparisons.

I think the truth is actually in between.
Iceman's points about Auckland's 'Financial centre' status are relevant, but so are Moa's comments about Auckland's smaller population.
So maybe Auckland prices should be halfway between Sydney and Brisbane.

@Iceman "it's about the jobs and opportunities". Interestingly in our department, we have 3 new kiwis from Auckland this month; one IT Security Analyst; one BA and one Cloud Network Engineer. All said they couldn't find any suitable jobs in Auckland!
Already we have at least a dozen of kiwis working here.

Yes I would agree with you on there not being suitable IT jobs in Auckland. That's mostly due to a lot of IT companies folding or having to relocate to Wellington because they can't afford to operate in Auckland. Put simply the cost of living is far too high in Auckland for most legitimate businesses to thrive.

I've seen quite a few senior IT folk leave Auckland. Generally because they wanted to get away from the housing situation in Auckland and simply build a good life with their family.

Isn't it comparable to where you can get jobs, economy etc by that logic iceman we would compare Auckland to London, New York, Paris. Little old NZ on the other side of the world with equivalent house prices to these cities.

To me NZ is no economic powerhouse, at least Brisbane has the Australian market as well. Auckland has Hamilton, Whangarei huge powerhouses of economic activity.

Measured internationally, Auckland’s performance is relatively poor: it is ranked 69th out of 85 metro regions in the OECD in terms of GDP per capita” – and notes it has a 40 per cent lower GDP per capita than Sydney and Melbourne.

Lots of people relocating out of Alk and Wellington as well.
Dunners going off... house down the road expected to go sell in the early $700's just sold on auction for $820 plus.
You guessed it Alk buyer.

Wages are actually higher in Wellington then they are in Auckland. And a lot of business folded in Auckland (Particularly in IT) or had to relocate to Wellington simply due to the cost of living having been driven up due to foreign buying which sent rent and property prices sky high.

No negative comments please as strictly instructed by The Man 2. And don't forget to buy in CHCH!

But... but I was just about to buy in Palmerston North, the City of the Future. I'm so confused!

Believe me, I lived there before! The only future for Palmy north is Kmart and Hokowhitu Lagoon, it's getting greener with algies.

ChCh is the adrenaline capital of Nz
Be in quick

100%, nothing beats the adrenaline of being chased by a pack of skinheads..

Seriously Chairman , your phoebia around skinheads is unbelievable.
You obviously have had a bad experience but we have never even seen them to any degree, especially in the last 10 years.
The coalition government is a helluva worse outcome for NZ than some people with short hair.

Perhaps you should get out more..

What is the fascination with christchurch skinheads here on interest? The terror attack was committed by an Australian so do we ban all Australians because of one person?

It's banter.

Great comment ggp. Now build a bridge and get over it

I think it's a pretty succinct and accurate answer to your question. It clearly is banter - Chairman Moa says it all the time to get under The Man's skin, and it somehow works every single time. Seems to work on you, too?

No it doesnt, you just looking weird

Countdown's special for this week is Blackmores brand vitamin to boost your sense of humour, 60 tablets for $9.95.

Chairman, I do get out and about heaps in ChCh and never see skinheads anywhere.
They were around 10 years ago but nothing of any note since.
We are in Europe at the moment and I can confirm that London etc. is where the problems are, not ChCh.

What's the feeling there in england about boris and brexit

Lower for longer...lower sales, interest rates, bank profits, bank bonuses, overseas laundering, immigration, and Govt funded large capital projects. All adds up to winning on debt farming.

Add to the ALREADY SLUGGISH market, the implications of the Saudi oil attack.. may need a new title.. Sluggish and Murky market...

Meh, it's still 10% down on April prices. Wake me up at $100 a barrel.

im not referring to just oil prices as a result of the attack, more on what lies ahead in terms of geo political risks...

there is now more evidence that Iran was behind the attack...

After the Iraq WMD intelligence rubbish, that they waged war over, can we believe whatever they say about who is to blame? In any case, there are powerful people in the US govt who want to attack Iran militarily, so that is a real risk.

I presume the Russkies would jump in if the yanks attacked Iran? That must be a bit of a deterrent because things could then get really bad.
I just don't think the benefits of an attack can outweigh the costs. Hopefully there's the odd rational person advising Trump...and he did just sack an Iran hawk.
Iran are being cunning, they know this. They know the USA could only possibly justify an attack if Iran's own attack was much more substantial.

$100 a barrel would crumble the Alk property market. 50c increase with all the driving and no wage increase would ba a killer. Plus the increased costs of food / services... it would sink NZ into recession..

absolutely, would be a killer.
I don't think it will happen, fortunately.
The USA will only attack Iran if they have a more compelling reason to do so.
So we would need sustained or larger attacks from Iran. Then all bets are off.

USA does not need to attack Iran.
Saudi will do that (and lose)
America provoked Japan into Pearl Harbour by economic strangulation. They learn nothing

We need overall sales numbers, not samey auction numbers. The most important thing will be how fast and many of all the new builds are selling, so we can tell if the much tauted shortage is legit.

A plus / minus on sale price v CV.

Greg

Is this data series still being updated? The data is very useful. The most recent data is June 2018 - about 15 months ago.

https://www.interest.co.nz/Charts/Real%20estate/House-price-to-income

An update on that would be great.

I recall David Chaston commented on here in the last 6 - 12 months to disregard House Price to Income stats, because it's mortgage serviceability that's important.

Oh yes, ignore the glaring number that spells trouble and insist that it’s only current serviceability that matters - a new normal, a new paradigm etc.

It can be noted that on Trademe currently there only 12,000 houses, units, flats and town houses for sale which is only a third of the number for sale 12 months ago. You would think, if demand was there because of the "housing crisis", that they would all be snapped up, but yet sale data shows that only half the listed properties sell at auction. It shows that there is no housing crisis at all, except for the relatively small number of homeless people who will always be with us. It also shows that only a very small number of people really have to sell or buy, and would stay where they are or rent. But renting is a double edged sword since the Government declared war on investors by piling on one draconian regulation and expense after the other onto the rental investors. The next "Housing Crisis" is in sight. A drastic shortage of rentals and ever increasing rents followed by even more regulations. Anyone contemplating being a landlord of residential property should be immediately committed to the appropriate facility.

There will only be a (greater) shortage of rentals if existing landlords not only leave the business of renting but burn their investment properties down on their way out. Their actual options are to sell to another investor, or to sell to an owner occupier. Either way, at least in theory, it keeps the balance of rental supply vs demand exactly the same.

"There will only be a (greater) shortage of rentals if existing landlords not only leave the business of renting but burn their investment properties down on their way out. Their actual options are to sell to another investor, or to sell to an owner occupier."

By my calculations, based on the FY2016/2017 tax filers, about 22% of privately owned non owner occupied residential property were claiming tax losses. The number of negative cashflow non owner occupier residential property owners is likely to be higher if you allow for those that are profitable and on P&I, and the principal payments result in negative cashflow.

If these owners choose to sell (especially capital gain oriented owners in the absence of capital gain in Auckland, or due to increased debt payments from going from an interest only mortgage to a P&I mortgage), there may not be active buyers (either owner occupiers or investors) at current market price levels. If the owners need to sell, owners may need to lower their price to attract active buyers if they need to sell.

Agreed. Because of that, the logic is that there is more reason to expect a reduction in house prices than any change in rental costs. (And then if purchase price goes down while rental costs stay the same, the rental yield should go up until we reach an equilibrium where investors are interested again).

You would think, if demand was there because of the "housing crisis", that they would all be snapped up, but yet sale data shows that only half the listed properties sell at auction.

The difference is between desire and actual economic demand.. People who can't afford (or aren't willing) to pay the prices being asked don't count as demand, they are mere bystanders.

'People who can't afford (or aren't willing) to pay the prices being asked don't count as demand, they are mere bystanders.'

Exactly. 'Effective' demand

It's amazing how this is overlooked.
There is *demand* for a house, from me, but given my income I'm irrelevant to the market unless it falls a fair way.

There are, evidently, ALWAYS buyers and sellers.
The point is, there are a LOT fewer than there used to be and it depends on what year you compare to.
The Auckland market is selling almost precisely the same number residentially as it sold in 2017.
That is because the primary driver in both years was a cut in funds coming into the market from abroad.
Meanwhile interest rate cuts have not led to more sales.

In May to August (4 months) 2017, there were 6919 sales.
In same period in 2019 there were 6757. Or 2.76% fewer.
In 2018 there were 7621 in the same 4 months, so 2019 is down 11.2% on that.
In 2006 there were 11,389 sales.
Auckland will continue to drift sideways, all in all, with some parts of it doing better and worse than others.
prices will continue to drop gradually unless there is an economic shock: like a war between Saudi and Iran?

This is the first article mentioning the potential over-supply of property in Auckland. Note that they are referring to effective supply over effective demand thereby creating a buyers market.

This is very different to underlying supply and underlying demand as calculated by most economists, and property market commentators.

https://www.stuff.co.nz/business/115747375/high-sales-low-prices-signs-o...

Spring is here. Open home that's been on the market in our street for like 6 months was mobbed in the weekend and the SOLD sign went up today. Amazing what a difference the time of year makes in selling your property, especially Rural where wet, wet, wet is a real problem.