The number of properties being auctioned by Auckland's largest real estate agency continues to increase week by week but the sales rate appears to have flattened out at just over a quarter.
Interest.co.nz monitored 187 residential properties auctioned by Barfoot & Thompson over the week of February 5-11, up from 135 the previous week.
Of those, sales were achieved on 51 properties, giving an overall sales rate of 27%, unchanged from the previous week.
Around the Auckland districts, the highest sales rates were achieved for properties in the Franklin district on Auckland's southern boundary at 50%, although only eight properties from that district were on offer. Properties out west in Waitakere had the lowest sales rate at just 19%.
The latest results support growing evidence that there are plenty of listings on the market, giving buyers the most choice they have had for quite some time, while vendors will need to be realistic when setting their prices reserves if they are wanting to achieve a sale on the day.
You can view the results for all of the auctioned properties monitored by interest.co.nz on our Residential Auction Results page.
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88 Comments
Barfoot's Auckland Central auction had 22 properties for sale yesterday but only one sold. Over half had no bids at all. Let's hope this up-bidding madness is finally abating.
I saw that, claims of flattening out may be a little premature. 1 out of 22 is 5%. I also noticed that many of the properties were owned by investors, including overseas owners looking to bail out of the market.
But prices holding......
What's new?
TTP
If prices are holding it won’t be for long with interest rates going up and inflation, more stock trademe levels up 10% in one week it only a matter of time before the tumble.
Depends. If it's just vendors fishing for silly money, many might just hold on. I tend to agree that a correction is coming through.
Holding on is going to get a lot harder as rates increase and the removal of interest deductibility is phased in.
Many will fold in due course.
The resident expert has spoken, and so it will be
We are looking at the trend here TTP…. Not many people are expecting price to drop overnight, especially when the market has been extremely hot for a while.. let’s give it couple of months and wait for RBNZ and US Feds to continue to hike their rates…
Do you have evidence of prices holding? The 6% rise over the past three months is due to the November pricing, it will go negative within 2 months unless there are policy changes. Look at the houses that are selling, the vendors have lowered their expectations.
Hi company of heroes,
We've been giving it another "couple of months" for at least the last quarter-century.......
FACT: The DGM has always maintained that house prices will plunge on the back of a surge in listings. But the DGM has always been wrong.
TTP
It's not just a surge in listings that will cause the problems.
I thought you were in property.
Hi HouseMouse,
I rent.
But like most other renters/tenants, I’d rather own the roof over my head.
TTP
But you own a property business.
So surely you know that it's the combination of surging listings and a fall away in demand (high and rising interest rates, CCCFA etc etc) that will mean prices lower.
Surges in listings in the last few years have not been coupled with crashing demand.
Hi HouseMouse,
Don’t own or work for any business - and never had the desire to do so.
Just enjoy sitting back and watching life’s passing parade.
TTP
You are playing semantics, aren't you.
Anyway - I'm right, aren't I? If you don't think I am, provide a counter argument.
Your turn.
My track-record with comments/predictions/forecasts is all that should count here. If I ever make a botch-up, I'll take it on the chin.
House Mouse, I suggest you overcome your preoccupation with me - and get yourself a rounded life.
TTP
Haha
..you’re a politician!
Carefully not quite answering the question there.
TTP if you really believe this housing market is not going to take a tumble you must be looking at old data just to remind you interest rates on the rise inflation high and NZD under pressure plus surge of housing coming on market. Please explain how this is being DGM just facts.
Alright, lets forget about that "couple of months" part then, so what's the current trend telling you? Low sale numbers, increasing listing, increasing interest rate, extremely unaffordable etc. If your way to analyse market is to just read the price. I guess we can end our discussion now...
Yes, one property sold which met the vendor's price expectation which is likely in line with where the current market benchmark price.
Unfortunately it's not a Dutch Auction, so we will not see what the other properties could have realistically fetched to get a better gauge of how the market is faring. Prices are sticky on the way down. Zero properties could sell in the next 6 months, and we won't see a fall in price statistics.
I always enjoy a good TinkerThePrice hot take on prices.
Yes it's comedy gold.
Seems like Darvin's theory is working. All those with less intelligence, greed and fear went in early and all the had in their kitty to the auctions and bid out large.
Now its time for intelligent to come and bring balance to the world.
RBNZ just said more than half of FHB will be in big stress when interest rates go up. And interest rates are going up. No matter what. We measure our currency aganist the USD. Fed is going to increase the rates, so there is no way out. Darwin theory will work out and only survival of the fittest will once again happen in the natural world out there.
I'll celebrate even if a fire sale event comes round the corner.
Some old man in mid-west once said,
"When it's raining gold, bring out the bucket!"
It hasn't failed me in this life time.
You sound like a really sociopathic parasite.
Please don't insult parasite. They're actually useful.
I thought there was room for upwards valuation...
I can predict in the next update by Greg the percentage remain the same more or less 4% to 5% change, even one property sold out of 22 in an auction yesterday.
The reason is simple if RBNZ can count inflation at 4.9% & 5.9% in the last two announcements, then B&F is not govt institute and can share data at their convenience.
I am not saying it's fudged but the data can be slightly adjusted to keep the hope high.
Another perspective might be to look at the number of unsold properties each week. Here's the last 4 auctions:
- 17 - 21 Jan: 35 unsold
- 22 - 28 Jan: 56 unsold
- 29 Jan - 4 Feb: 99 unsold
- 5 - 11 Feb: 136 unsold
That's a lot of vendors getting reality checks instead of the blank cheques they're expecting.
Those numbers will drop off as auction method of sale tailors off but pretty interesting right now.
Auctions aside, we sold in Masterton November/December last year. We had 1 offer on our deadline sale, 5 viewings across 3 open home weekends.
There are 3 other properties within a block of our old place which have been on the market since October. Price guide low to high $500s.
12 months prior you'd turn up to an open home to find at least 10 groups of people there before the agent even turns up. Properties would see a sold sign in under 2 weeks. Tradme listings typically hover around 100, they're currently at 166.
It is the same throughout the Wairarapa. Houses just aren't selling. Covid uncertainty may have a lot to do with it as is the CCCFA. Last year unconditional offers without any finance requirements were often needed to win a tender. Now money seems to have dried up. Houses that were up for tender now have prices on them, with some having the price dropped, and they still aren't selling
It is quite bizarre given the Wairarapa has a reliable daily commuter rail service into Wellington, so I thought that and the ability for many Government employees to remote work would keep demand high for property in the region. Maybe they're buying all the new builds in the various sub-divisions popping up around the place.
Here's a quick way to remember a maxim,
"Stock and flows speaks liquidity, prices speaks everything else."
In real estate, liquidity is always secondary to price and you'll be mistaken to assume both are the same.
Velocity - average days to sell is important as well...
there is no return in rents now ie deductibles (interest) etc, if prices start falling there is no reason to buy as an investor until the numbers make it a safe investment, the bid is a long way lower
Only in the short term. Tenants are locked in and cannot buy and the labourites have come to rescue landlords via increasing all incomes (bennies, min wage) which should play out as higher rents. Inflation of new housing costs should effectively insulate the value of existing... but no guarantees
Yep absolutely no question we have turned a corner. 2022 will be very interesting as we see how investors, FHB's, Govt, RBNZ etc respond. There are some economic realities, both locally and globally, that may well have a big say in what happens.
We all have opinions on here and no doubt each want to believe they are right for various reasons, but only time will tell. All I know is I am happy with where I am right now, many say I am to conservative in my views and they are probably right, but I will sleep well tonight.
Expecting to see another 100 articles in the NZ Herald bashing CCCFA then...
Banks would really love to boost the auction sales figures. Out of "heartfelt sympathy" and "deep sense of charity" for those declined mortgages !!!!!! BUT, first they pressure the govt to remove the fishooks in the CCCFA .These are nasty and trip them into personally liability if they do not practice responsible lending by shovelling unaffordable credit upon borrowers .
I am getting the impression that full sized sections in "average" suburbs are going off the boil. It would be interesting to follow the properties that didn't sell at Barfoot's Friday auction. One got a bid of 825k and was bought 8 years earlier for 485k, another a bid of 780k and bought 6 years earlier for 555k.
Will they regret their decisions or will they go on to sell for more?
Edit: I see now that one got a bid about 120k below expectations and the other 265k.
Yes I think so.
So much development is coming on line, and so much demand is falling away, it makes little sense anymore to pay top dollar for good development sites - full sections.
And with the government's RMA changes coming through, there's much less scarcity of development sites.
yes developers not bidding
Be quick open the borders Labour !
We can wait a while for that.
We need a couple of big builders going bust.
I think you will find more leaving than coming.
Open the borders to allow people to rent out rooms to boarders!
That will save us!
My watchlist, 4+ br in a "premium" suburb, definitely looks off the boil. Nothing selling at auction, most now priced.
People have stopped paying up for junk, but in the Auckland city fringe suburbs I monitor, every standalone house on 500 sqm + seems to clear at auction.
We have simply flown far to close to the sun in a drunken orgy of debt. None of it supported by income. RBNZ is between a rock and a hard place. Their mandate is to control inflation, not protect a property bubble.
See what next weeks announcement will brings.
February 23rd is going to be very interesting indeed. Shame its before the FED in March, nothing like a red hot poker to get you moving. All bets are open on the size of the rise. Got a TD coming out 19th Feb, going to hold off on the reinvestment for a few days.
The question is how much will the banks raise their TD?
If anything, they'll pass you the crumbs after they got the bread and butter with the ham in it.
Over the last two years the RBNZs announcements have been nothing but a dissapointment... given this I'm not sure Orr will deliver anything meaningful and it will be BAU.
I think it needs to be 50 bps, Orr needs to give it a decent whack now. And I actually think he *will* do 50.
I think there is a possibility of a 100 point rise, small possibility for sure but wouldn't that only bring us up to the pre-Covid level anyway ? 50 will have no effect at this point in time. No rise or 25 points at this time would be seen as sickening.
50 Bps followed by two or 25 BPs will start to have significant impact, on top of a housing market and economy that's already showing early signs of sickness.
No chance he will do 100. Outside chance of 75.
I'm calling 25bps - Orr will will be cautious and probably say something about already moving quicker than any other country in the world
Quite possible.
It's a close call.
I think he'll be a bit bolder, earlier, and then be more cautious.
No chance he will do 100. Outside chance of 75.
And I actually think he *will* do 50.
50 Bps followed by two or 25 BPs
Im calling 25bps..... Quite possible.
It's a close call.
There is nothing like a person who knows their own mind HM
no
100 smells of panic , regret and mistakes at RBNZ
50 not to be used in a pandemic
25 more likely and clear signalling of many more
housing are not rising or selling so 25 is ok
All 25 is signaling that the RBNZ basically intends to do nothing for the rest of the year. Plenty of people got their fingers crossed for this however with the 60% of mortgages that are falling due in 2022.
Minimum wage going up 6% in April. At very minimum a 50 bps rise will be needed.
Even the CPI chart is fairly revealing of what's needed.
https://www.stats.govt.nz/indicators/consumers-price-index-cpi
I think slow rises will be cruel for NZ.
Got told once the best way to eat a s**t burger is fast.
A few points here and there won’t change a damn thing because the market left fundamentals so far back.
go hard and go early I say!
150 point rise would make Orr as famous as Ardern
hold my beer Orr finally in international news
"We have simply flown far too close to the sun in a drunken orgy of debt."
Love the poetry/fantasy......
But the reality is somewhat different.
TTP
Houses are a lot like bonds, you either trade them for the coupon or a risk view on face value.....
Now that houses are falling and the credit is set at restrictive, houses must be priced based on coupons (rental earnings) ....
An entire generation is going to learn about negative equity.
After 20 years of boom the last couple will be given back, think thats around 40-48%. but it does not matter if its 20-30-50+ its the sentiment that drives this wave, predicting ammounts is like predicting how far up the beach the wave will wash, pointless really. just make sure your sand based castles sit above the high tide mark
Yeah agree about the property/bond point - interest rate up, bond price down. Its just we've had 30+ years of falling interest rates and now a severe case of confirmation/recency bias across society that house prices only go up.
A lot of strategic buying up North. Most up there are relatively poorer; keep buying and the locals up there will have to keep renting while rental stocks diminishes at the same time. That completes the loop whereby rental shortage pushing up prices of current online and offline stocks.
Simple and shrewd strategy working beautifully.
There're simply more people needing a shelter than available houses.
I won't be surprised that the National house prices are up strongly after this season.
Go for smaller towns with a larger population of people on the housing registers; the MSD's housing register list can be a guide to where to buy strategically. Use the number on the register and divide it by the number of houses available for rent in the area on Trade Me or Real Estate NZ- the larger the number, the better the prospects for rents and capital growth.
Be quick!
Hi CWBW. I know we all like to knock the PI on here, me being one of the knockers. To be honest, I think NZ would be pretty screwed at the moment without the private sector. The government’s lack of ability in any area regarding housing is mind blowing. Negative 5 houses built in 18 months! My partner owns 3 rentals in Gisborne, she offered them to KO but they turned her down because they were older homes (1960s I think). She’s took on tenants and removed them from the government waiting list, good honest working people just with no options because of a lack of homes. It’s a fine line as I fear most of the people on the list would not be able to purchase and the government has no ideas.
I like the phrase "Government has no ideas"
I think some of the smart people in NZ need to get together and firm up a new party which will really take our country to new heights.
We do not need empty, hollow politicians who just sway like dry clothes on a clothes line.
We need strong and intelligent decesion makers who will create opportunities for this generation and help build a strong foundation for the next.
The current politicians have no idea about their own future, they can't create a good one for us certainly.
Good on her mate!
Try to look from investors' point of view; if there is money to be made, we would had been irresponsible not to make them.
Perhaps then you'll understand why knocking on investors is actually wrong.
Going to Northland and buying up properties is a very sad life plan mate!
Got to get ahead ha?
Fishing is good, country lifestyle, weather is fine, quakes seldom bother, floods aren't a thing and you get to stake the waters before the annual 90 mile beach challenge.
What's not to like?
5700 place’s for rent in Auckland 10800 to buy quite a lot of choice
Supply increasing, demand decreasing = ...........
Why do I get the feeling there is a lot of crap for sale in the housing market ? Its a last chance to try and offload the rubbish at the peak of the market but they have just missed it. Very strange things happenings on Trade-Me with cars as well, a particular car I have been watching suddenly has 3 pages of them for sale. Looks like a lot of collectors are selling up, you don't usually even see one for sale.
Take away the number of 2 bed homes which have flooded the market. Caused by something called a pandemic which closed borders, shut down intnl tourism and education. Amazing who would have thought
Your type can stay the heck away from Northland thanks.
Just listening to someone from the Housing Council being interviewed. Obviously very pro saying such things as we will see a "softening" of the market nothing more, auction activity has changed a bit recently with "some properties" not selling! Promoting the game to continue but some very very carefully chosen words and skirting around certain topics. Quite entertaining!
It’s criminal really. People that don’t follow closely (or read Interest) have no idea that the market is changing. During smoko conversations most people think that house prices are still rising every month and believe that property prices can never fall in NZ. The Media need to report the auction clearance rates and softening market, this will enable people to make informed decisions.
Problem is I think a lot of people won't really grasp the data. If you pick a person from random, hell you could pick someone in your family that you know aren't Interest.co readers, and you tell them 1 out of 22 properties sold at Auction on Friday their response will be "Oh, okay is that good or bad?".
I notice Interest.co.nz's brilliant article showing that the share of FHBs had INCREASED since CCCFA was not repeated in the MSM.
Yeah.
Tony Alexander is sounding quite bearish on the economy but hasn't said house prices will fall. He's being quite coy.
Even though he's not working for a bank anymore he still has clients in property related fields.
But maybe he really doesn't think prices will fall.
I've noticed Tonys statements are getting vague with no real commitment to predictions/forcasts...no doubt he doesn't want to upset his funders. I did however hear him this week state there could be house price falls 'here and there' - may have been a slip up...
Sharron calling -7% house prices at ANZ
The best way to profit from falling house prices is to short Aussie bank shares.
Nah you'll get into a mess doing that. They will make margin on increased interest rates, a few mortgagees wont bother them.
thats a bet you could also make selling naked puts....
I would rather be baying the well out of money puts though
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