Barfoot & Thompson's sales numbers rocketed up in February and overall stock numbers remain low but prices were a tad weaker

Barfoot & Thompson's sales numbers rocketed up in February and overall stock numbers remain low but prices were a tad weaker

Barfoot & Thompson's sales volumes reached a five year high last month.

The real estate agency, which is the largest in Auckland by a substantial margin, sold 804 residential properties in February. That was up 70% from 474 in February last year, and the highest February sales volume since the height of the last property boom in 2015.

There was also a jump in new listings with the agency receiving 1640 new listings in February, up 4.9% compared to February last year. That is, however, still well down on the period from 2015-2018 when new February listings ranged from 1747 to 2295.

And the total available stock level remains tight, with the agency having a total of 3670 residential properties available for sale at the end of February, down 21% compared to the same time last year.

Despite the increase in sales numbers and more restricted choice facing buyers, prices slipped back slightly in February compared to January. The average selling price dropped $31,078 to $920,553 in February from $951,631 in January. The median selling price declined $65,000 to $820,000 in February compared to $885,000 in January.

Although the latest average and median prices remained within price bands evident for the last three years, they were towards the bottom ends of those ranges (see chart below).

It is too early to say if that represents the start of an easing in prices, but it may indicate that the middle to lower end of the market is more buoyant than the middle to upper end.

'Apartment sales influencing median and average prices'

Barfoot & Thompson managing director Peter Thompson described February's sales numbers as "exceptional" and said the increasing number of apartments being sold in Auckland was influencing median and average prices.

"Stable prices were a major factor in why so many sales were made in the month," he said.

"The prices buyers were prepared to pay met vendors' expectations and our clearance rate of properties at auction and by direct negotiation, were close to the numbers we were selling at the height of the 1990s property cycle."

Another factor contributing to the average and median prices remaining stable was the growing influence of apartment sales.

"In February sales of properties under $500,000 represented 16% of all sales," Thompson said.

"In January sales of under $500,000 accounted for 4.7% of sales."

"There is every indication that the excellent start the market has made to the year will flow into March, which is traditionally the best sales month in the first half of they year," he said.

The interactive chart below shows the trends in Barfoot's monthly sales volumes, median and average selling prices, new listings and annual price growth. 

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75 Comments

The median selling price declined $65,000 to $820,000 in February compared to $885,000 in January.

Although the latest average and median prices remained within price bands evident for the last three years, they were towards the bottom ends of those ranges.

Good news for prospective FHB. Interesting as it seemed from Mikekirk's figures last month that more new builds were influencing higher medians, while this month the story is more apartments influencing them. Sub-$500k apartments are going to be pretty small.

Maybe the government is buying them for isolation cells

Huh, is there that many houses under $500K in Akld, must be shoebox appartments

"In February sales of properties under $500,000 represented 16% of all sales," Thompson said.

"In January sales of under $500,000 accounted for 4.7% of sales."

Some apartments in the city were selling for under $200k not so long ago. There was even one that was 'pro bono' attached to a different deal if I remember correctly. Leasehold property is a risky business.

Just reinforces the only reliable house price indicator is the REINZ data.

Sellers dropping price a little bit to get out of the market before it turns to sh*t. Hence more sales lower prices.

Next HPI will confirm or refute that.

The price of stand alone and freehold houses in population centres in New Zealand will continue to increase to a level that will never be reachable for an average family.

20 times of a median household income (1.4 million) will become a norm.

Mushroom theory

Oh Dear Xingmo, did they not bring your rice and water to your propaganda cubicle this morning?

You forgot to add.... "democry can never give give to western citizen what enlighten leader of CCP can".

Sorry Timmyboy. Rice is sold out in all supermarkets..

I have been on Keto for quite a while.
Cheers

Aha, that explains it.

Keep up the good work Xingmo. You are very entertaining.

Akh Xingmow dear.. honestly, after you've learnt just a basic ins/out about Human body for about 7years then added more years on top of it.. and still never stop until now? - I really suggest you to stop that Keto before it's too late, our body is not like a mechanical machinery, often comparison is drawn but it's just for the purpose of easing up the explanation - If I were you? - I really follow your Uyghur comrade dietary practices.

Yes, I would agreed with that comrade Xingmow.. NZ has a lot to catch up with Hong Kong, Shanghai, Vancouver, Singapore. We're catching up but really in my opinion it's too slow.. what do you expect? sleazy Kiwis. - ideally? now, we should be around 1.8-2m as the norm.

Corona virus is just the fuse to light up that debt pile.. It will go bang soon.
Buy that house and load up more debt if you have the two dangly bits down there made out of steel.

11
up

Most people are ignorant to what is happening around the world at the moment and think "its just a flu"

We got a hint of panic at supermarkets when we got our first case, can you imagine what will happen if we see community transmission???

The property market will probably lag by a few months and then its a question of who needs to cash up, whose business is going quiet and whose jobs are on the line.

We really need to hope for all hell that we can contain the virus from getting a foot hold here, but I dont like our chances unfortunately,

Global recession is looming, if I have to make a bet it's 70:30 at the moment.

I'd say 95:5, as the measure for global recession is lower than +2.5% growth

2 or possibly 3 months before this really starts to cut deep. Practically no chance of stopping this virus due to its characteristics, the best we could have done is close all flight travel and delay its arrival and therefore minimizing the number of deaths until a vaccine arrives in actual volume production. Speaking of a vaccine, as we don't make anything like it here we are going to be last on the list to get it. Good luck getting any out of China if they come up with it first, how many people do they need to vaccinate again ?

Ha ha I put thumbs up there Carlos spot on, this bug gave us crazy days/nights, but man they're fascinating, they regularly produce false negatives during certain testing (this keep on evolving) - now, another points though? that I should emphasize.. this new rock star status bug, really loves to be carried by the younger generations.. they usually develop the natural immune towards it, then recover. OR? stay dormant for more than 24days. But boy oh boy..those in elderly brackets? somehow become an easy target.. so? depends how many ICU beds we have collectively nationwide vs. the number of not so young generation to be taken care of, should this becoming big. The NZ med training has less exposure to tropical med & pediatric, but so flourish for age care/geriatric med care - so, go figure... Winter is coming. This rock star, just like rugby.. like to be in winter game.

Also depends on how many people decided to be proactive before they find themselves in the need to sell. I.e. sell before shit really hits the fan.

Yvil, both average and median prices in Auckland still well below peak.

Indeed, although REINZ HPI measure is more complete, as most of us agreed

March is coming Yvil.
RU going to say that virus is stopping your price forecast coming true?
Over-stocking and cheaper sales of smaller property starting to drag price down.
Virus will induce further price reductions

Beware the ides of March?

Spot on Mike "Virus will induce further price reductions". If you take a look this mornings news you'll see the snippet: "Home sales in China fell -40% in February, and maybe more".

Yes you're absolutely right Fritz, and it was obvious even in the auction results that there wasn't a huge amount of properties selling above their 2017 rateable value. Though I'm sure the AKL market will come out of stagnation once the new OCR cuts kick in and mortgage rates drop a lot further, So more people are pushed in to deeper debt. Big question is how long those mortgage rates will remain low.
I'm sure the property bulls will be bouncing around again, being abusive to anyone that points out what is actually going on.

Core Logic has my home at 102.2% of 2017 CV as at 1/3/20. No movement.

"And our clearance rate of properties at auction and by direct negotiation, were close to the numbers we were selling at the height of the 1990s property cycle., and as prices fall towards 1990's levels we will be selling more homes than we did than the noughty's decade "said Mr Thomson

Good news for Barfoot buyers as Kiwibank see (demand) March 50 bps cut followed with OCR 0.25 percent end point.

"Despite the increase in sales numbers and more restricted choice facing buyers, prices slipped back slightly in February compared to January. The average selling price dropped $31,078 to $920,553 in February from $951,631 in January. The median selling price declined $65,000 to $820,000 in February compared to $885,000 in January."
3.2% of selling price and 7.3% of median price dropped in a month is not something close to"prices were a tad weaker"...

Fascinating how quiet the bulls are when the news on prices isn't so amazing.

They are all too busy trying to sell. When markets crash, the exit doors become very small...

Just bored more than anything.
FBB = crash... wrong
Ring fence losses = crash... wrong
5 year brightline = crash... wrong
Kiwibuild = crash... wrong

Now Covid-19 = crash...
More apartment sales = crash

You can only try and convince chicken little for so long before letting him squawk unanswered.

13
up

None of those were wrong. They are all steps towards the cliff. We have just had one very big step that has taken us over.
No one cares about convincing you.
But thanks to the efforts of some rational contributors, I do hope a few savers have held back and avoided entering this debt fueled housing bubble ponzi right at it's peak.

Make the call then, 20% drop... 50%?...

Nahh still too early. See Rastus is right, the above points have played out to a certain extent and enough to show that they have impacted house prices. We know that the banks are keen to keep the market propped up by reducing mortgage rates rather then let prices fall. So best to wait for mortgage rates to bottom out first before making any call on a market stall.
Here's one prediction that is pretty much certain: The more mortgage rates drop and LVR's relaxed, the more NZ property prices will increase.

I personally forecast UP by 65-70%, as clearly RBNZ soon reduce OCR by 50 or 75 basis points, following the US & OZ, except NZ is more daring black sheep as compare to other herd. This will ensure to eliminate the doubt and lowering world countries barricade/block/isolation due to this Covid19 distribution. Why? - those isolation block shall be lowered down in order to fetch a business/money & goods movement to/from NZ - Nothing can resist the power of cheap money, as you can see? China started to announce 'business as usual' to the world - shipments started to move in/out to those country that lowering their OCR - be seen as friendly, ally to China needs right now. Mark my word: IT WILL GO SURGE UP ! ;-)

Some people have shared a different opinion from that of the commonly repeated mainstream media message of the property promoters, property mentors, real estate agents, property developers, mortgage brokers, bank economists posing as salesman, mainstream media who get paid advertising from the property sector, and others who are mainly promoting their own vested financial interests.

Those people who have shared a different opinion, for the most part, do not have a vested financial interest.

People are given the information to allow them to make a more fully informed decision, rather than a decision based only the narrative of the property promoters in the mainstream media.

People are free to choose, however people are not free from the consequences of their choice.

I wouldn't expect a knock on from current events for 2-3 months as most pre-approvals for loans are assessed at that duration.

Surely this is nothing more than apartment construction in Awk (which has been a lot) starting to show up as completed and now settling. This will be an ongoing trend as more and more if the "under construction" apartments are completed. The rest of the "its all great, numbers rockets etc" is just spin.

What's odd is that most new build apartments seem to be comfortably above the $500k mark. Must be some little, leaky, or leasehold ones to have that many under $500k, one would think.

Although I see a few more houses out certain parts of the South going for ~$500k again too.

Great example of why the median price can be so misleading without looking carefully at composition.

Unfortunately we are not told how many apartments they sold relative to feb 2019.
Also, it is important to know what you are comparing to: in early 2109 the effect of AML legislation delayed and suppressed sales numbers due to conveyancing changes at REAA and lawyers. So, in 2020 you are comparing to artificially low figs in 2019. Looking at Feb 2018 is more instructive.

668 were sold in feb 2018. So, 2020 is 20% up on that.
Feb 2019 sales were 470 cf 668 in Feb 18, that is they were 29.6% lower than year before.

Lot more apartment sales being stated means potentially (bearing in mind that apartment sales have been falling in Auckland for 18m) that a larger group were trying to sell what they owned in central Auckland, who were less keen in the months prior to Feb. Who is it that owns lots of apartments in central Auckland who might want to sell them in Feb 2020?

Other possibility is that the over-building of apartments is now biting builder-developers in ass because they are over-stocked and trying to offload. To test that, we would need sales prices for same size place in February 18,19.20. Which we are not given either. if off-loading is occurring at lower prices, then phase 5 of the down turn has arrived at precisely the point when for 3 months the Pollyannas have been saying new boom is on and prices will go up. I notice that median has fallen back. Median is a reflection of the number of cheaper apartments and townhouses being sold. As consents for these are going up as a % of new stock all time, median is being pushed down.Virus effect will not suppress sales til next month

I don’t know about you, Mike, but I have always found it odd how much of the data seems to be obfuscated through various means. To me it seems like we are given relatively isolated snippets that are designed to fuel some sort of specific response or behaviour. We know the data exists to indicate very clearly what the market is doing. Running a model with variables to account for factors such as interest rate adjustments, global shocks, and so on, is pretty straightforward. Given that the vested interests are the ones who mostly control the data and its release (banks, media, property owners etc), what is shared to the public has to be treated with a high degree of skepticism. That’s why keeping your own eye directly on the market - what’s selling, what’s being reduced, how many homes are coming online, and so on - is so important.

It would be great to get a large scale study utilising all the available data. I’m pretty sure there are those who know what’s coming. Chances of that being disseminated to the masses - practically zero.

Indeed. Unfortunately, independently prodcued data and analysis is hens teeth.
People who have the data want those reading it to think a certain way, so they give them data to try to induce that, and what they do to state is of course revealing in itself.
Government data is inadequate and 6 months behind trend line.
Private sector data is based by who is paying.
Univ. academia also has to pay the piper.

The big no no right now is that what governments and banks are doing cannot produce inflation.
Because it has not been able to in last 11 years
But it will now because of harvest and crop failure in USA, Aus and China (animals) Plus of course shortages cause prices rises
All of that means inflation will rapidly rise to 5-7% in 6 months in my view.
Which will crush demand because wages will not rise and interest rates will have been cut and not be able to raise them because markets would collapse along with house prices.
So,powers that be are stuck and are over-reacting.
Plus the cuts to interest rates will not help.
Debt is going to blow up and banks will soon be in trouble, as Mauldin making clear today.

Only when the tide goes out do you discover who's been swimming naked.

Warren Buffett

1 new Coronavirus cases just announced. It has begun. If your a property investor leveraged to the hilt you have 2 or 3 months to dump your holding. Personally if it was me I would be shitting my pants right now. Preparing to catch a falling knife in the market.

Not sure if the window is even 2-3 months.

Prospective buyers are going to stop doing house inspections, open homes if the reported cases increases to a certain level.
The normal marketing period for a property is at least 2 -3 weekends of open homes to generate buyer interest.

Instead of focusing on buying real estate, people are going to focus on reducing the risk of catching the virus, stock piling necessary goods to survive.

Likely expectation is that the volume of transactions will fall.

The other thing is that some house vendors who are looking to sell, may have already made a purchase elsewhere, with an impending settlement on the purchase. They may have expected to sell their existing property and use the proceeds for that purchase. They potentially now face the challenge of trying to fund the purchase, without those sales proceeds, if the price offered is unacceptable to the vendor.

Then some other recent purchases may have been contingent on the vendor being able to sell their current property. If the vendor is unable to sell their property, then the purchase falls through. The vendor of the other property now also has an issue as they may have been expecting the sales proceeds from their sale ...

But Carlos, even the monkey can be trained slowly to catch it on the same direction down and by the blade side, try it just perfecting the technique.. it's still possible, with plenty minor cuts.. the trick is to avoid large, heavy, sharp knife that fall from great heights. Just don't.

As a FHB I'm bullish on coronavirus. I mean a virus that disproportionality kills boomers, it's like a dream come true. Bring on the crash and the ensuing estate sales.!!

Sadly this could turn into a FHB and DGM's wet dream. The house of cards already had the speed wobbles it was only a matter of time. This is a 9 on the "Rich"ter scale.

"I mean a virus that disproportionality kills boomers, it's like a dream come true. Bring on the crash and the ensuing estate sales.!!"

Let's keep in mind the more important issue here - the potential loss of life and human cost. Most people don't want to lose a loved one. If you've ever lost a loved one, then you know the mental and emotional toll it can have on people.

Here's a thought that might make you rethink your comment above, what if it was your loved one? You may not have any elderly relatives who are vulnerable, but what if you, your close relatives or close friends caught it by some social interaction.

I empathise with your circumstances of wanting to buy a house and a desire for lower house prices, but people shouldn't be wanting other people to die in order to personally benefit from that.

(19)73 indicates you're not exactly a spring chicken either Matt

I second CN's comment. Coronavirus will indeed bring about diseased estates, but cash is about to become trash through the monetisation of defaults. As F. Scott Fitzgerald said "The test of a first-rate intelligence is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function."

Housing boom in the last 10 years, thanks to the FBB from China.
Now the Corona virus could potentially lead to a crash, thanks to .....
What china can bring, China can take away..

A mate in the know told me today he knows of 3-4 large development sites for sale that Chinese owners want to get rid of.
Might be a trickle for now but who knows.

Fritz,

Just out of interest are they:

1) land developments? ie. sections for sale
2) house and land projects?
3) apartment projects?
4) other?

Vacant sites with consents.
Typically 1-3 hectares in size.
Not sure if they would have been on the market anyway if the virus didn't exist, but he seems to think it is virus-panic driven.

Are you sure it's not the one claiming by that Chinese lady which already sealed the deal with Fletcher under Nat Co? - Ihumatao if not mistaken.

From a mortgage broker - observations of land speculators (note that this was written 12 months ago)

https://www.squirrel.co.nz/blogs/housing-market/is-2019-the-year-that-th...

Note: Barfoots reporting apartment sales ratio to all sales tripled in February.
Since apartment sales were falling in prev 18 months, 3 guesses why now risen so fast and who is selling??

Its a trickle but unfortunately its a trickle of Urine and you know what comes next.

I still loved Chinese take away (no pun intended) .. but yea rather caution this day.

I’d like to know what sellers intentions are when selling. Anyone know any agents out there? Whenever I have asked in the past ( a few years ago) it was fairly well spread between upgrading, downsizing and relocating to retire.

Don't be like that flip-flopping news daily, about positive, negative, hardly sideways - We must be remain positive & vigilant not just around this Covid19 news - but around the positive promo assurances news about NZ property as for future wealth and secure investment for all Kiwis, only by relaxing our foreign buyer's rule, restrict the current residential zoning for new build, maintain current RMA status, reduce OCR further, relax LVR, remove this silly CAR from the Banks, secure period of moratorium to exclude CGT, cancel this April deposit guarantee scheme and other things. World craving for it's citizens dwellings, NZ should show how to overcome it. The only way is to maintain the sharp steady growth upwards on pricing, If NZ govt won't help? then the regional should keep their momentum of upwards assessment on residential land valuation.

?

seconded.

Yeah, it's WTF?
I want some of those drugs

I love these asian sounding rambling thoughts.

Pump everything up, endlessly, what could go wrong?

Tony Alexander says all will be swell. So it will be.

Got a link?

Instead of being compared to Long Drops, NZ houses can now expect one.