The latest auction numbers suggest a late rush of activity as we head into summer

The latest auction numbers suggest a late rush of activity as we head into summer

Residential property auction activity has picked up substantially over the last few weeks and is now running ahead of where it was at this time last year.

Interest.co.nz monitored 316 residential property auctions in the week from 18 to 24 November, which was more than double September's weekly average of around 120.

That compares to 307 auctions monitored in the equivalent week (19-25 November) of last year.

The sales rate is also much higher this year with sales achieved on 165 properties, giving an overall sales rate of 52% compared to just 36% in the equivalent week of last year.

However prices do not appear to have moved a great deal.

In the week from 19-25 November last year, 63% of the recorded sales prices were above their rating valuations, while that figure was 70% in the week from 18-24 November this year.

The Auckland market may be marginally more buoyant than the rest of the country with a sales rate of 54% and 71% of selling prices being above their rating valuations.

The latest figures suggest the subdued market conditions that were prevalent over winter made for a slow start to spring, but the market then improved rapidly through November and should remain on its current course until it starts to slow again for the Christmas/New Year break.

Details of the individual properties offered at auctions monitored by interest.co.nz are available on our Residential Auction Results page.

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Wonder how long the mortgage interest rates can keep falling to keep the ponzi scheme going? I'd estimate by this time next year will see mortgage rates of 2% or lower.

Yes, indeed, these low interest rates are good for first home buyers and investors.

TTP

Yes.

FHB should make the most of current conditions while they last. Feeling on the ground is that the buyer’s market is slipping away in Auckland. I’m a bit surprised how early this happened, if the bottom of the Auckland market is indeed here already. I’m still picking relative flatness for another year to 18 months though.

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LOL, Neither of you get it do you. Falling mortgage interest rates can only last for so long until you hit zero then what? Oh I guess prices will fall. Having capital gains based on mortgage rates cuts is still a false economy, just getting people especially FTB's further in to debt.

Hi CJ099,

I note that you begin most of your posts with "LOL"- i.e. laugh out loud.

It does appear that you spend an awful lot of time laughing out loud - with emphasis on "awful".

Of, course, there's the odd other person here with the same affliction - with emphasis on "odd".

With all due respect, I recommend that you return to the giggle factory for some targeted treatment.

TTP

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Honestly is that the best counterargument you could come up with TTP? Not actually addressing the interest rate issue are you. But hey, you still make me giggle with your comments. :)

He almost never addresses the issue like some others here. It's not even worth trying to engage with them.
They are in their own little echo chamber.

After making yourself a clown so many times, you still get upset by people laughing at you?

Hi Court Jester,

That's a bit rich coming from a self-proclaimed jester.

With all due respect, I submit that you also appear to be a candidate for some anti-giggle therapy........

TTP

CJ099
You are still not getting it; falling interest rates are but one of the current drivers. Current continuing high immigration rates and housing shortage are two biggies.
At least you are now starting to concede that there is currently an upturn / firming in the Auckland market.

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Nahh it's only falling interest rates for the lower to middle bracket and some money laundering (for the upper price bracket) that is keeping property prices propped up especially in the larger cities like Auckland. Not immigration that much, oh and try to remember that we have a Foreign Buyers Ban so how could new migrants buy property if they don't qualify yet?

Also for Auckland we have 39,393 empty homes, so what was that housing shortage again?

CJ099
You are loosing it mate.

LOL, I see you have no counterargument have you Printer8, so you're resorting to abusive behavior to try to intimidate.

Hi CJ099,

Still giggling......

TTP

Yes because I have the evidence and facts to support my point of view where you and you're REA buddies don't. :)
Plus the evidence is already in your face, since there's very little house prices movement especially in Auckland which is still a stagnating market.
By the way Ttp you still don't have a counterargument do you. ( ͡ᵔ ͜ʖ ͡ᵔ )

Great for investor but anything that leads to price rise may not be what FHB are hoping for or want.

House value $800000 and with 20% deposit loan of $640000 and say moratge off approx $700 per week and if price rise to $880000 and moratge of $705000 with interest rate falling is still $700 per week (assuming) than also what is better :

Carrying a loan of $640000 With moratge of 700 per week OR carrying a loan of $705000 with moratge of $700 ( More loan and also more deposit required)

Anything that leads to price rise could not be good for FHB who is out in the market to buy his first home, specially in current environment when the house price are already too high and average Kiwi is streching / struggling with every $, specially in Auckland.

When OCR was not changed / reduced - so called experts/ media with vested interest went after RBNZ that is bad for FHB but reality is otherwise.

Those low-interest rates, TTP? They are going MUCH lower. So "go for it!" borrow all you can, if you have the spare capacity ( seriously!), but DON"T SPEND IT! Keep it 'offset' - at no cost - and just see what today's borrowed dollars can buy tomorrow. ( if that's housing, so be it. But the price, like lower interest rates, will be far below what you see advertised today).Tomorrow, lenders won't be putting too much out, especially as rates will fall further, so 'get your "cheap" debt onboard, now!'.

and with household deposit growth slowing - how long before the banks have to find alternative funding options.......

Yes, alternative funding investments such as turning a blind eye to money laundering. Take the current Westpac fiasco, here's an article on some of the latest news on that: Westpac investors in an information vacuum as bank looks to raise $500m. "Westpac is in the process of raising $500 million from retail shareholders who have virtually no idea of the extent of the financial damage that will be inflicted on the bank by Cyclone AUSTRAC".
https://www.smh.com.au/business/banking-and-finance/westpac-investors-in...

Add to it, the capital ratios in a week..

I certainly think we could do with further enforcing our AML rules. Looking through the latest auction results there looks to be some very dodgy transactions. Such as 5/11 St Georges Bay Road, Parnell a 2 bed apartment, Recently sold at auction for: $1,441,000 that's over double it's 2017 for August sale prices of $660k (View council records).

If you look at the photos, the apartment block is fairly basic and drab. In side it's be decorated to a good standard but not that fantastic. Oh and has lovely views of partly rusted neighboring roof tops. So really can't see how or why anyone would want to pay so much over and above it's value, unless they were trying to clean their ill gotten gains.
Property link: https://homes.co.nz/address/auckland/parnell/5-11-st-georges-bay-road/Y1...

Central banks generally are not populated by experts in behavioral economics. Alan Greenspan admits that now. Central banks are potentially setting us up for the disaster they're trying to prevent.

I wonder if the $660K sale was a family discount type price, e.g. something like parents selling to one of their children. The key clue being "Owned by the same family since the 1980's" in the 2nd paragraph of the link you posted. Another clue is that 8/11 sold for 1.22m in Feb 2018 (https://www.barfoot.co.nz/property/residential/auckland-city/parnell/apa...). Another relevant factor could be that a lift was installed in the building recently - I image that was an expensive upgrade.

So while 1.441m does seem like a high price, it may be a lot closer to market value than you were implying.

Nahh that's a very feeble justification to try to hide very obvious money laundering. Is that the kind of excuse that a Real Estate Agents have been telling you to justify prices, don't be so naive. Look at the previous sales history and RV valuations on the property for 5/11 St Georges Bay Road, Parnell. In July 2014 it's RV was $655k then in July 2017 it's RV was $730k then Sold in August 2017 for $660k, then in Nov 2019 for $1,441,000 that's over double it's 2017 in just 2 years when the Auckland market is in stagnation.

There's a lot more money laundering going on then you think, over billion a year comes from drug dealing and fraud, and can be laundered through New Zealand businesses (mostly property). NZ Justice website: https://www.justice.govt.nz/justice-sector-policy/key-initiatives/aml-cf...

RVs can be way out of whack. Or are you so "naive" that you didn't know that? :-)
The previous 1.222m sale of the other unit had a similar RV, which supports the theory that RVs are out of whack in this complex.

Yes, money laundering is a thing I'm well aware of thanks. I don't think it's wise to go around claiming specific sales are cases of "very obvious money laundering" unless you have clear proof, and even then you're better off going to the authorities than posting on some random internet site.

The proof is in the previous sales price, you REA's simply can not justify the doubling of a property price in just 2 years, it's absurd especially in Auckland's stagnating property market, that simply points to dodgy dealing. And if we can see it you can be sure the authorities are can see it too.

"Oh and has lovely views of partly rusted neighbouring roof tops."
WTF where? Pull the other ponytail CJ, the property is located in 'upmarket' Parnell. You will not see any cats on a hot tin roof there. PS watch the spelling for inadvertant americanisms

Really not selling that much are they in those so called expensive suburbs. Go gaslight some one else HW. Not surprising that listings are up in area's like Remuera when you have neighbors like these guys. Article Herald: Accused money launderers barred from ANZ after luxury cars, Remuera houses targeted by police https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12262884

I suspect that new capital ratios will favour lending on residential property at the expense of business lending

Hmm.. i suppose all they need to do is to open the immigration gate a bit wider. We run an immigration economy in NZ.

Odd isn't it? You lives in India, China,Malay, Singapore, Vietnam, Cambodia, Japan, South Korea, Hong Kong etc. - none, if not mistaken is soo much ever uttering in regular basis about Immigration as part of the key economic parameters?

Already slowing. Look at listings and also new listings per day

"The sales rate is also much higher this year….However prices do not appear to have moved a great deal"

Further evidence of the lack of correlation between number of houses sold and house prices

Nonsense. There's a correlation between any pair of variables if the data is suitably prepared. Strength of the relationship is determined by the coefficient.

Blinded by your own intellect J.C. ... Or blind spot

Blinded by your own intellect J.C. ... Or blind spot

Nothing about intellect. It's about being honest with yourself. Bandying around language that you don't understand in order to make a statement about how things are is typical in the internet age. Doesn't means that people should accept it. Simply calling it for what it is.

Looks like Yvil has you in a corner

Why? Assume he is correct and the correlation between house prices and sales volume is mildly positive. Does it mean that sales volume is not a predictor of house prices? No it doesn't. It's simply a correlation. Does it mean a flood of new listings will not negatively influence house prices? No it doesn't.

Yes, please.. more & more listing, rush.. shifted the hot metal bar to the next on the ponzi, .. the more the merrier, remember 'it's a game'.. of risk mitigation, calculated.. more addiction, more desperation (albeit in no presence of valid reasons) - you can choose to be part of the game or watching in the sidelines. Remember like watching your kids playing rugby? there'll be winner & loser on the field. But mostly, you'll be safe as spectators.

Looks like we are on target for all time high house prices in March 2020 (predicted last September)

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Do you ever think about anyone else other than yourself? I feel sorry for those leaving school now, entering the workforce and facing 8-10 times income to buy their first homes in parts of NZ. Trying thinking about other people before yourself and your capital gains. It actually makes you feel better and happier.

I won't be surprised if he is one of those goofs that runs those investments seminars... entice people in to more debt..

Sadistic is all I can think of...

To be fair, he's balanced in comparison to Houseworks and TTP. They are pathologically self centered, and frequently nasty.

Gordon, DGM Fritz,
Me making a prediction that house prices will reach record highs next March is in line with Interest's motto "helping you make better financial decisions". I don't cast a judgement whether this good or bad, you guys do that. This is a business site and too many posters views of what will happen is clouded by what they subjectively believe "should"happen

Unfortunately for you Yvil every comment you make is now coloured by earlier comments you have made on this site. We all know where you are coming from every time you comment even when you do not have a judgement in certain comments you make.

Perfect illustration of my point above, you said "Yvil" followed by 7x "you".
I focus on business issues, you focus on attacking people. I'm not interested

Isn't it the other way around.. you're constantly prowling this site waiting to attack people.. that is your main job, everything else is a side business

Of course he doesn't. And neither do any of his property spuiker mates.

Yvil - I think you will be right on the money about 'all time high house prices in March 2020 (predicted last September) ' !
Some angry people on here today !
The Auckland market is waking up, some good years ahead !

Another boomer thinking about his or her pocket. Stuff everyone else especially those who are yet to start working.

I know, some of them do not seem to give a rats ass about where the money has come form either. Well think of it this way, they're going to end up with some unsavory neighbors in their expensive suburbs. Not surprising that listings are up in area's like Remuera when you have neighbors like these guys. Article RNZ: $9 million seized in Auckland money laundering investigation.
https://www.rnz.co.nz/news/national/397659/9-million-seized-in-auckland-...

Gordon - Oh please that's a tired old phrase !
Look neither you or I make the rules in this game of life, things happen or not, sensible people see things for what they are and we all individually decide whether we participant in it or not.
Life does not care about you or me !
It was always easy in the past right ? Well I can tell you plenty of my boomer friends are poor and mostly because they are sixty plus and don't own their own place - got that ??
Every Generation has it's problem's and issues but over all each new generation has more and more opportunities.
If you deeply believe your hard done by being in the generation you are, then life for you will always be hard.
Step out of yourself and embrace all life offers you and your generation, being resentful will never allow you to grow.
Get along somebody that has made an effort and done well, learn and be grateful for your life.
By the way for nearly 40 years I have heard people predicting doom for NZ property, I would imagine they still rent and have a very limited existence today, don't end up like them Gordon !
Go work for a few years for good money in the outback or similar, I did, then you have advantage over your peers.
Happy investing

Go work for a few years for good money in the outback or similar, I did, then you have advantage over your peers.

I see. You believe another mining boom will occur where any old dogsbody can rock up and make a fortune. Good luck with that. Perth is teeming with unemployed and under-employed people who participated in the mining boom and invested in the idea of "you can't lost with bricks and mortar."

JC - There are many places other than Perth to ply your trade and choose just where you may want to by bricks and mortar.

"Go work for a few years for good money in the outback or similar" doesn't really sound like "plying your trade" as you say. And not saying that there's anything wrong with following booms for employment. Reality is that the need for human labor will differ for each opportunity. The prior mining boom in WA benefitted many unqualified, low skilled workers. Won't necessarily happen elsewhere.

I generally agree with your post Shoreman, and it's good to hear your perspective that you have done the hard yards, with your head down and not complaining. That probably has a lot of relevance to your successful career.

Although you say "Life does not care about you or me !" Yes no one else will make us be successful however as financially successful people we are in a strong position to give assistance to others. We should not forget from whence we came and not hesitate to give back in some form. Enjoy your night.

Thanks Houseworks we all walk our own path in life and it disappoints me hearing such negative views as Gordon's. My aim is to give another perspective to encourage thinking outside the square to see another way.

I did not need to go to the outback for work Shoreman as I was one of the lucky boomers who got a free university education which was followed by 30 years in a profession and retirement 6 years ago at the age of 58. Commercial property and equities have been the foundation of my retirement and I have travelled a lot in those six years with my family. I am a rare commodity on this site as I admit I am a boomer and that I have been lucky with my date of birth which is 1955. When assets were cheap I had the equity and income to buy them. The only one I did not get into was residential tenancies as I always knew they would not give me the same stimulation and return as the asset classes I got into. So many New Zealanders have been blinded by housing and have missed out on better opportunities with less hassles.

"I had the equity and income to buy them."
What LVR did you go with Gordon, two-thirds mortgage was the norm for commercial property. And although you chose not to invest in residential housing many of your peers would have I am sure, as in the 80s landlording was very common. Rather rich of you to attack and troll people who make that choice.

That was certainly a bold prediction at the time Yvil, but looking somewhat more likely now. I'm picking that the (Auckland) market will be lower by March although I don't feel particularly confident either way. For sure there was an uptick around August/September but to me it feels like things have stabilized over the last few weeks and maybe already started to soften. It'll be interesting.

House market in Auckland did seem to jump in October/ November as few houses went for fantastic price but those that were not sold under the hammer are not getting the asking as are approx 10% above and some much more than 10% than what the buyers are ready to pay (Ready to pay September price but not October prices).

So this jump is not on a very sound footing and may not last. Also most houses in market are those that have been bought by investors/speculators in 2016 or after - Why will unless are using this opportunity to offload and future to them does not seem to be positive.

Seems that the steam is comming off and the jump that was observed from October in Auckland comming to end.

What has to be seen, will the housing market stabilise at current price(high) or will it fall.

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=122...

New marketing strategy.

House with a CV of 1.1 million and would normally fetch near around million (or may be 1.1 million) but expectation is 1.3 million as trying to promote, as a site for building apartments (Many houses with land can build so nothing unusual except have spend money in project report). Listed about a month and half back, failed in auction : https://www.trademe.co.nz/a/property/residential/sale/auckland/manukau-c...

Now to tempt investor (though is still listed) have bought those proposed one bedroom and two bedroom on sale in trade me- how serious are they or is it just a marketing gimmick to promote house.

May be tempting investor (carrot) with : https://www.trademe.co.nz/a/property/residential/sale/auckland/manukau-c... and https://www.trademe.co.nz/a/property/residential/sale/auckland/manukau-c...

Confusing are they marketing consented site or apartments or may be marketing straegy to sell the house at premium.

Dead cat bounce? Possibly. Whilst we like to think we know everything about everything in NZ, time & again this is proved a myth. Kiwi's are generally pretty naive about global affairs & we are too far in to turn back now on what is essentially a global monetary experiment in my view. How many layers of debt upon debt will it take? Sooner or later the chickens will come home to roost.

Read about the Indian banks writing off trillion dollars worth of bad assets.. all those that piled into housing as they thought the economy was booming and that house prices only go up.. now they realize they can go down too

Have you sold your place in India?

Not yet BHSL

In which city?

[Edit: ESOL poet, if you don't answer I'll have to assume the worst]

Wow, I love your arrogance.. you expect an answer, else your veins start to twitch..

You're a rat bag on this site, so your assumption is worth a rats shit

Classic ESOL Poet response - love it

Big deal. Wait til banks get higher cap ratios next week

Government now borrowing big to spend..

Low inflation is the only thing that kept interest rates low.. that could possibly change

Fifteen suburbs have tumbled out of Auckland's "magic million-dollar club" after a year of sliding house prices in the country's biggest city. Experts say first-home buyers and subdivisions are to blame for the falls...People wanting to sell and upgrade to larger homes are now often finding mainly first-home buyers in the market, meaning they may have to soften their sale price a wee bit to meet that demand...Mission Bay was one of eight suburbs that fell below the $1.5m mark. Expensive homes weren't selling in the suburb...It comes as Auckland's house prices have now been on an 18-month fall. "
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=122....

Those pesky First Home Buyers! It's all their fault...But not to worry! That 18 month period of 'sliding prices' must have come to an end by now? No? Well maybe, next month or the one after that or...
Don't you just love a slow easing; it's easy to pick the bottom, isn't it?

Spend more time doing something productive bw unless you call boring and repetitive productive.

Productive use of my time is to try to give other New Zealanders an alternative view of the destructive path that residential property 'investment' is leading us down. Judging from your comment, I'll suggest you disagree, but, hey! That's what makes life interesting....
(NB: I have no problem with anyone wanting to truly invest in property for whatever reason IF (1) they use their own accumulated capital to do so - ie: they've made it from their 'day job' and are looking to place it out somewhere that isn't just a Term Deposit, ( and they don't borrow the funds. It isn't just 'another business' like any other to be leveraged . 0% LVR on any secondary properties. Housing is a necessity), and (2) it isn't subsidised by other New Zealand taxpayers who have chosen not to participate in the property speculation market)

"NEVER, EVER, EVER ADD TO A LOSING POSITION: EVER!: Adding to a losing position eventually leads to ruin"
https://ggc-mauldin-images.s3.amazonaws.com/uploads/pdf/TFTF_Nov_29_2019...

I have broken most if not all your rules bw.
I suspect you are guilty of having a narrow perspective of property investment in that you only see a 3 bedroom house is suburbia being rented to some poor unfortunates who should be the rightful owners instead of the rentier who is squeezing them hahaha. That is NOT how I see investment and NOT how we invest.

Good for you. It takes all sorts of perspective to invest in anything. But there are reasons that experienced investors and traders have the views outlined in that article. Failure can be ruinous when it happens. ( and leverage makes the possibility and the outcome even worse)
3 Bedroom house as my view on property investing?
Hardly!
My last '3's were: The 3rd-floor apartment on Bondi Beach ( Rotate the view - https://tinyurl.com/u8m6kxw ); 100 acres of farmland, comprising 3 paddocks, in Queenstown ( that is now a private golf course); a 3 story newbuild (done for me) in London and a 3-hectare lifestyler in Christchurch. But I did follow 'my rules' in all cases - 0% LVR. I opted out when I thought the market 'fundamentals' had changed, about 10 years back. Could I have run my positions longer? Sure! It's all easy looking back. But 'leave the last 10% on the table for the next buyer' is another saying, not mentioned in that link I gave you, that I agree with.
The markets have changed. If you can't, or don't want to see that, that's fine. And time will tell, as it always does.

"Could I have run my positions longer?" Speculator? Or old money?
That's an impressive list of properties bw but the rest of us relied on a mortgage to get a leg up. PS bondi has same bins as Auckland haha

Not old money, and not a speculator, as such. Just particular views at particular times in particular places, that fitted the economy of the day and my circumstances.
I have no probs with people/families borrowing to buy their own home. None....
But they wouldn't have to borrow so much; service so much debt - no matter how 'cheap' it is, and tie up so much disposable income if house prices were much lower. Some day, somehow, that will happen. The trick is not to get caught with more than your own home when it does....

You were a speculator bw with your "particular views...that fitted the economy" and "Could I have run my positions longer? Sure! It's all easy looking back." until 10 years ago. With that you benefitted. What a hypocrite you are now to claim that house prices would be cheaper without having the current crop of investors. Unfortunately you are not the only investor who got out beforehand and that now comes on here preaching doom and inequity. Btw I hope you paid tax on your trading profits.

Good comment Houseworks. I am getting tired of these hypocrites too.

Really, yet you're constantly defending the CCP..

You are delusional if you think that property investors won’t need to borrow.
It just makes total sense to borrow as interest is a cost of business that is tax deductible.

So 'investors' will stop investing if interest rates rise or tax deductions cease?Of course!
And then what happens?
Property prices fall - until they reach a level that (1) individuals can buy a home without so much cost and (2) investors CAN buy with their own money and not borrow!
That's how it used to be. People made their pile in some productive business - be it farming or running a business of some sort - and took that earned capital and bought a true investment property to rent out to those who still couldn't or didn't want to own.
Those days will return, it's just a matter of when, and how painful the adjustment will be.

Property investing is a more Productive business for us than any other business.
We have control of what we do and do not have the hassles of needing to employ people and associated costs.
If farming is productive for the country, then why on earth does the current so-called government want to hammer farmers?

Property investing is all you are capable of doing on top of being an agent. Aren’t you the angry old boomer recently moaning about how the government was interfering with real estate legislation? Not so much in control are you!

Hasn’t affected us at all GORDON as yet!
Not an angry boomer either.
How did your outing go today?

Why then do you comment on Jacinda and the Coalition and their policies with such bitterness and anger. There is no one near you on this site for the kind of comments you make. The stupidest one would have been the one when you commented about her being PM and pregnant. You certainly showed just how old you were then. The dumbest one was when you admitted you are an agent. I have never been an agent but if I had I would certainly be keeping it secret.

Gordon. You are showing your biass.

This remind me of a bitcoin value on last quarter of 2017, but off course this is different kind of Ponzi. Some decided not to participate, watch from the side.. and do something else in life. The OCR potential into negative? - Some will say, it's good for the FHB, investors, RE agents, Seller & Banks...who else? - So, this is a good news for the whole country isn't it? - We need to keep on this path of success.

The only path to long term NZ's success, is to allow our cost of living to reduce by deflating the property Ponzi scheme that has created a false economy. If we reduce the cost of living that will allow real business to thrive and then we'll have long term GDP growth.

It was a bold strategy CJ099 selling up your rental properties two or three years ago and then campaigning for a massive drop in house prices so you could then re-enter the market for a big win. Bold because the chances of success were slim.