Residential auction activity cooled slightly last week with fewer homes on offer and fewer selling under the hammer.
Interest.co.nz monitored the auctions of 174 residential properties last week (1-7 October), down from 184 the previous week.
Of those, 60 were sold under the hammer, giving an overall sales rate of 34%, down from 41% the previous week.
School holiday periods often result in reduced auction numbers with many vendors and potential buyers travelling away from home, but even allowing for that, current numbers are low considering we are now in mid-spring.
Canterbury was the bright spot last week with an overall sales rate of 70% compared to just 28% in Auckland.
Details of the individual properties offered at all of the auctions monitored by interest.co.nz and the results achieved, including the prices of those that sold, are available on our Residential Auction Results page.
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42 Comments
I gather the auctions on the ghastly 'The Block' also encountered a degree of buyer resistance :) ...........
30% is still a big number of people who are willing to buy at auction and have cash ready to pay for the advertised price.
What could be so pressing reasons to buy at auction in this day and time?
It's not that people dont want to buy, it's that they cant borrow the money. As Buffett was quoted "interest rises have the same effect on price that increasing gravity has on matter".
But wait for last years price it can only go up...tui.
The Block has helped disseminate and consolidate the front line news that property values are declining. I think that we are at a point where we will see a much more uniform view of the NZ property market and this is only going to dampen appetite to buy if waiting is an option.
I see the Spring bounce as being a non event with further big decreases over the Summer break with a torrid Autumn and early Winter in store. I'll be bold and say I think we are half way down from peak. I suspect that the bottom will come in May / June ready for a potential change in Government and the economic data supporting a modest decline in OCR.
Imagine if your house had weeks of in-depth marketing of an hour per night at prime time television time, where the biggest buyers with the biggest equity and lust in the housing market are the nightly viewers, with a celebrity host showing you through the finer detail of each and every room and you only sell for $4000 over reserve...
everything else is toast
I would suggest that paying north of a million for a questionably appointed 3 bed terrace on the outskirts of anodyne Orewa would be fairly risky.
Zen,
Inherently risky or in the current environment?
current, but who knows - maybe long term too if it's a leaker
NZD750,000 for a 450sm section in orewa😂😂😂
Given the meteoric activity we have witnessed in recent years, it comes as little surprise that what we are witnessing is activity falling off a cliff. Owing to elevated interest rates, its likely this will continue for the forseeable future.
Not Tim↘️
Pretty sure that most of the people on here that are going on about the bad property market are going to have bigger things to worry about next year. There is a good chance the wheels are really going to fall off just about everything come Q2-Q3 next year.
Absolutely, given that Australia is going to be unhabitable in nine and a half years.
What’s the quote….80% of Australia is uninhabitable due to deserts, the remaining 20% is uninhabitable due to Australians...
I found the majority of NZ uninhabitable because of Kiwis too if I'm honest.
All those not enjoying being surrounded kiwis are free to relocate again elsewhere, especially if your cant see and enjoy a bit of NZ vs Aussie banter.
Parts of it are already uninhabitable mate, when you cannot leave your house for hours in the middle of the day and have to have the aircon going full blast, that's uninhabitable in my book.
You could always try growing a pair.
Carlos,
Are you thinking unemployment and stagflation?
Unemployment. The RBNZ will be forced to chase the FED and if the FED doesn't stop when we start waving the white flag we are screwed. The pain very quickly escalates with rates over 8% and lets not even think about double digits.
I'm pretty sure that fed won't even notice if we wave a 1000 white flags. Our entire country is the size a single medium sized US city. Why would they care about us? They won't
That’s what I previously thought but I am less bearish now. There’s lots of slack in the system, the labour market seems structurally resilient.
In areas like construction, I think many foreign workers will return home once the slump hits, and there may not be too much in the way of increases in the unemployment rate.
I still see real weakness in 2023, but we might miss a technical recession, and unemployment might only be 4 to 4.5% by end of 2023.
The "Employment" situation in this country literally changes overnight. So many small businesses with the owners raping it financially.
There is simply no financial stamina, one or two bad months and staff are getting layed off left right and center.
Its funny how the vested interests are trying to almost make out its just plateauing when its cleary crashing to anyone who has any clue about real estate prices..... and more supply is coming on at a time when very little is clearing.
If you have had one way traffic for twenty plus years, and you have a big investment in a leveraged asset class, you have the blinkers on cannot believe that change could occur. That is an ASSumption, and can make one of you and me.
Popcorn.
Precisely Averageman. Outside of basic economics the way peoples mind generate thoughts to assuage unpleasant emotions is very well understood.
Behavioural economists have described much of the psychology of crashes, but it somehow remains hidden to those in the thick of it.
I would argue that until prices reach long term averages they are in fact correcting, since long term average is where they should be. Crash would be a significant fall in prices below long term average. So the correction has maybe another 30% to go
I am enjoying Nikki Connors new Propeller Property Ad. Her advice is to buy a property 7 years ago and sell it today for a healthy capital gain. Why haven't you called us yet?..... Because the ship has already sailed.
To The Point, is she advocating bailing out and banking the capital gain before the erosion really gets going?
this from the property investors page on fb....god bless.
"Good morning everyone,
Just come across very sad story of my friend and thought it may be known upcoming problem… “interest rate pain”
My friend own few rental property roughly with loan portfolio of 3 mil of rental property.
One bank said he can only have interest only loan with their new rates of 7+ % on float, compared to what he had at 2.99%,
And no fixed rate offer for him.
Can bank force you to be on float ?
The other major bank offers 6.19 % with interest + Princpl and not interest only option.
Also with No interest deductibility.. and 10 yr bright lines leaves no room ….
I heard this and felt sorry for him…
Anyone else came across similar scenarios recently?"
The squeeze is coming on.
Hilarious. The entitlement mentality.
Entitlement yes, but the notion that you can’t lose with property is held with cult-like conviction by many. The mantras are still repeated about how their property values will be double in 10 years as they scoff at the price current decline.
Seemingly unaware that the whopping rising cost of debt is what will undo them.
I bet more than 70-80% of the population have this cult-like conviction, Ginger.
I'm sure I have the world's smallest violin here somewhere.... now where did I leave the damn thing..... 🎻
"The squeeze is coming"
No, the squeeze has been here for 6 months and has been widely telegraphed if you read something other than One Roof
The squeeze is getting squeezier
The squeeze hasnt even started, this is the start of the bbq patter after the 4th beer and worry comes flooding out
Diddums.
Three investor-owned properties have gone on the market in the last few weeks where we live. The owner occupied places seem stable.
The part that says "and 10 yr bright lines leaves no room …" is revealing. The underlying thinking being, but if he sells one now to stay afloat he would be taxed on any gain - FUCK!
Can’t lose any of that precious, precious capital gain!!!!
Desperately self entitled and greedy.
Not sure about the BoP numbers. I thought Eves had a relatively good week.
https://www.ftadviser.com/investments/2022/10/05/un-warns-central-banks…
The United Nations has warned central banks against further interest rate rises, saying more monetary tightening will increase inflation.
In a report released on Monday (October 3), the United Nations Conference on Trade and Development (UNCTAD) said the increase in interest rates, undertaken by many central banks to combat soaring inflation, poses an “additional risk” to the economy.
The issue is that our highly leveraged professional pension managers may fall over before our highly leveraged amatuer property investors... ie Bond Market carnage.... funny...
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