Auction activity picks up slightly but still bouncing along the bottom

Property / news

Sales rate at the latest residential property auctions edges passed a third by the finest of margins

27th Jul 24, 6:08am by Greg Ninness

Auction room activity ticked up a bit compared to the previous week at the latest auctions round the country monitored by Interest.co.nz.

Interest.co.nz monitored the auctions of 265 residential properties throughout Aotearoa over the week of 20-26 July, up from 212 the previous week.

Sales were also higher with 90 properties selling under the hammer, giving an overall sales rate of 34%.

That was up from 31% the previous week, and was the highest sales rate since mid-March.

However even with that improvement in activity, the total numbers of the properties being offered at auction and the number being sold under the hammer are both very low, and the overall picture they paint is of auction activity bouncing along the winter bottom.

The chart below shows the district results from the latest auctions around the country, and details of the individual properties offered at all of the auctions monitored by interest.co,nz, including the selling prices of those that sold, are available on our Residential Auction Results page.

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75 Comments

by 1689 Baptist | 27th Jul 24, 6:32am 1722018740

Good week for Queenstown.

Northland weak again after.looking stronger past few weeks. The effect of the Brynderwyns being shut is massive on the Northland economy, not just RE.

% above RV beginning to pick up. Not sure if that is new and lower RVs being reflected or prices picking up.

by Flying high | 27th Jul 24, 6:53am 1722020016

SH1 is open again, give it 5 minutes and check again

With 100 percent sold and above CV Gisborne is another hotspot success story.

by Baywatch | 27th Jul 24, 8:04am 1722024295

Love the Sat sarcasm

by Zwifter | 27th Jul 24, 10:09am 1722031778

80% in Tauranga which is pretty good but the RV's did fall a bit. Lots of changes coming before Christmas, lower rates and the US election. Changed my mind on the automatic Trump win now.

by bw | 27th Jul 24, 10:42am 1722033778

A bit?

"Otumoetai = -12.26%

Mount Maunganui/Bayfair = - 11.81%

The Lakes = -11.84%"

(From the attached map. https://www.tauranga.govt.nz/living/property-and-rates/property-valuati…

by agnostium | 27th Jul 24, 11:12am 1722035565

That's RV fall. What is the fall from peak?

by bw | 27th Jul 24, 12:13pm 1722039238

Yes, it's the RV fall. That's the 'bit' that was commented on above. I don't call a 12% fall in anything 'a bit'.

Re fall from peak? I'll let you look that up, but at a guess I'd say it's at least that and more.

by Zwifter | 27th Jul 24, 2:05pm 1722045940

Why don't you list the least affected areas, I don't live in either of those three anyway so yes it was only a bit.

by easymoney | 27th Jul 24, 2:45pm 1722048310

So you think Harris will win now

by Zwifter | 27th Jul 24, 6:33pm 1722061988

Its now going to be a close race, Biden would have been a looser for sure. The fact its not another male totally upsets the apple cart, now you have someone who appeals to a totally different market, also before plenty of people hated both Biden and Trump so how many of those will now come out to vote instead of not bothering. My money is now on Harris.

by HouseMouse | 27th Jul 24, 8:10pm 1722067811

At least she’s got good taste in music. I would vote for someone who digs Charles Mingus and buys his records

by Retired-Poppy | 27th Jul 24, 7:26am 1722021968

Waitakere, Papakura and Manukau are looking very vulnerable indeed.

Another week - same trend. Buyers hold the upper hand and will no doubt be lowballing.

by Flying high | 27th Jul 24, 7:38am 1722022731

Or not lowballing just no-balling. But hey spring is coming at the same time as rbnz is dropping... to breathe life in the patient (sarc)

Edit: spelling

by Retired-Poppy | 27th Jul 24, 7:55am 1722023710

Spring coming = even more listings. There's enough bloat as it is. In fact it's a glut. Since you're looking to buy, you'll be pleased - right?

by tothepoint | 27th Jul 24, 8:37am 1722026269

As interest rates begin to fall, people will have a stronger incentive to buy……

And those who have been feeling the financial heat will be less pressured to sell.

Housing market may be near the low-point of the current cycle?? Let’s wait and see. 🧐

TTP

by bw | 27th Jul 24, 8:39am 1722026344

Friday 19th July 2024.

by tothepoint | 27th Jul 24, 8:41am 1722026505

Hey, that’s my birthday! 🎈

TTP

by bw | 27th Jul 24, 8:54am 1722027277

And the present you chose for yourself is rumoured to be in the mail from Adrian.

by kiwikidsnz | 27th Jul 24, 8:19am 1722025160

A relative has been looking all year to buy a single level 2brm in/near Onehunga <$1M. Has been rubbish listed with little interest at open homes & they have found that every time they missed out the next one they offered on was a better house for the same price range.

They have just this week secured a 3brm in their mid price range, there were 4 offers on the property and many more people at the open home.

by Hahashishi | 28th Jul 24, 12:15pm 1722125710

It's really not that simple. I Just bought a property in this vulnerable Waitakere. The interest was fierce. I had to move quick to secure it. There are plenty of people out there waiting. If you're in a position to buy and service debt now it's better to risk it going down a but more than missing the bottom.

4 bed 1 of 2 on a 800m2 cross lease. Nice area, great acces to Westgate and highway for under $700k.

Imagine imagining that 3yrs ago...

by Zwifter | 28th Jul 24, 3:05pm 1722135932

Good on you, this is the market bottom, hence the interest.

by Hahashishi | 28th Jul 24, 12:15pm 1722125740

4 bed 1 of 2 on a 800m2 cross lease. Nice area, great acces to Westgate and highway for under $700k.

Imagine imagining that 3yrs ago...

by Piggy | 27th Jul 24, 8:05am 1722024301

Steady as with possibly a small bump reflecting the recent rate cuts. Spring is coming.

by bw | 27th Jul 24, 8:48am 1722026883

I compared the New Zealand residential property market participants to 'trained circus seals' earlier this week; that at the first sign 'hope', out we would all dutifully go to "get in before everyone else, and prices rise"

On reflection, that was probably a bit unkind to the seals. We're much more like Pavlov's Dogs really...

"Pavlov was a psychologist who figured out you could make dogs drool by shaking a bell at them when you give them food, then eventually just by shaking the bell."

by Flying high | 27th Jul 24, 12:04pm 1722038675

As the #***#** landlord never does any work to clean the outside this morning I decided I would spruce up and wash the house, long overdue now lookz a million bucks.. what a good boy am I woof woof

I dont know why I did it as I could just as easily be doing this on my own place.. And get a double reward, self satisfaction and added value

Edit: grammar

by bw | 27th Jul 24, 10:54am 1722034444

"The Pavlovian "buy the dip" reflex that was so profitable on the way up now becomes the road to ruin as every pop higher gets sold. Those playing "buy the dip" are eventually wiped out, leaving only those burned and wary. Eventually people tire of losing and they give up. Buyers vanish, the bid keeps dropping until buyers are willing to gamble that "this is the bottom." But should asset prices continue sliding after an initial euphoric pop higher--"the bottom is in, buy!"--then those who held back find their caution reinforced: that wasn't the bottom after all, and everyone who jumped in lost money. As every surge of "buy the dip" players has their head handed to them on a platter, the market goes bidless--everyone who wanted to play "catch the falling knife" has been burned, and those who have lost the "animal spirits" to gamble stay out. The market goes bidless, and asset prices crash to levels no one in the greed-euphoria stage could imagine were even remotely possible."

https://www.oftwominds.com/blogjuly24/illiquidity7-24.html

by NZGecko | 27th Jul 24, 12:03pm 1722038624

Those that think the "bottom is in" know little of long-term history, risk, or real INCOME BACKED valuations.

When the risk-free rate of return is 5% why would anyone buy or hold housing (as their major investment) when it returns just 2 to 4% ?

Now as we have all seen, the major capital losses accrued since 2021, the risk of holding a 3% earning housing investment, is just the riskiest strategy and devoid of any thoughts of the currently HIGHLY ELEVATED stage of the most epic asset Super-Bubble we have ever witnessed.

Many are conned into thinking in the "return to normal phase" - its clear as day. Incredibly risky and about to see the biggest downdraft of all!

Stages in a Bubble | The Geography of Transport Systems (transportgeography.org)

by Mystery | 28th Jul 24, 12:15am 1722082559

Unfortunately those 5% risk-free returns (I presume you meant the likes of TDs?) might be short lived as interest rates drop back down. Savers will be compelled to park their money elsewhere and real estate has always been a good place to park money over the long term. Of course it's risky, but so are most investments. Even TDs are not without risk - a bank can collapse and in NZ there is no government backed deposit guarantee just yet. If things will turn really bad in NZ/AUS then it's not impossible for some banks to collapse taking those "Risk-free" deposits with them.

by NZGecko | 28th Jul 24, 9:55am 1722117311

I choose 5% as the risk free rate, as the midpoint between Govt bonds (safest) and Big Banks TDs (safe) with the Govt owned Kiwibank, being the safest in a failure event.

The Big Banks will be bailed out by Govt, as we all know they are just TBTF.

Small banks are likely to be eaten by wolves.

So why risk the downside of currently overpaying for NZ Property by 40% ?? When you just get tiny earnings compensation of 3%........ and the mortgage funds are 6.5% with insurances, rates and maintenance going through the roof, with no respite in sight.

If your living in it, you can live with the losses comming for a number of years, but as an investment or monetery store of value, with valuations still sky high, its a mugs investment, by any measure!

by CN - new | 28th Jul 24, 10:38am 1722119894

"If your living in it, you can live with the losses comming for a number of years"

Not for those highly leveraged owners who are unable to hold on. Here is one example:

https://www.trademe.co.nz/property/residential-property-for-sale/auctio…

Remember there are thousands of households in negative equity:

https://www.rnz.co.nz/news/business/519396/thousands-of-first-home-buye…

by Hahashishi | 28th Jul 24, 12:20pm 1722126034

Seems there is more desire to hopefully be proven right in this chat than to take an educated approach and capitalise on a viable opportunity when it appears.

by bdogg | 27th Jul 24, 11:17pm 1722079053

Gee thanks, a 9 year old knows who Pavlov is.

by HouseMouse | 27th Jul 24, 11:56am 1722038187

Interesting case. Not especially convincing on either side of the argument. I would have thought a tangi with gang members attending is a pretty strong clue there were gang people living on the property.

https://www.nzherald.co.nz/nz/tribunal-clears-realtor-after-buyer-claim…

by Mypointis | 27th Jul 24, 12:09pm 1722038972

People buying a house sight unseen are asking for problems.

by The Man3 | 27th Jul 24, 1:08pm 1722042486

Have done it many many times over the years at auction!

Never made a poor decision yet!

The good buys are when you have no competition, and the profits flow.

by Flying high | 27th Jul 24, 2:33pm 1722047610

The good buys are when.. the profits flow.

No shit?!

by The Man3 | 27th Jul 24, 7:06pm 1722064008

No competition is when you buy well!!

by ex agent | 27th Jul 24, 2:53pm 1722048782

If I did not know better I would swear you and Wingman are one and the same person. No empathy for others, always right, never made a financial mistake and it’s so easy to invest in property. Get it right every time. He is a sad old conspiracy theorist. I hope you are not in that camp.

by wingman | 27th Jul 24, 3:28pm 1722050920

You forgot the word 'rich'.

by ex agent | 27th Jul 24, 4:01pm 1722052891

People would say I am also but I have empathy and I am not living down a rabbit hole like you.

by wingman | 27th Jul 24, 4:44pm 1722055440

I'm not living down a rabbit hole, I'm living THE life.

New house just started, will keep me busy for about 18 months, and sell my existing house just before the election, by which time I'm pretty sure the gravy train will have left the station.

by Zachary Smith | 27th Jul 24, 5:45pm 1722059154

I'm not sure whether people have empathy or not is relevant to this discussion. What good is empathy to anyone, really?

by The Man3 | 27th Jul 24, 3:37pm 1722051476

Not sure why you say I have no empathy for others?

I have got where I am financially thru sheer hard work!

by ex agent | 27th Jul 24, 4:04pm 1722053055

Over the years you have even looked down on and criticised those who pay you rent. Maybe they did not have your luck or opportunities.

by The Man3 | 27th Jul 24, 5:46pm 1722059217

Never looked down on any tenant!

It is not about luck Ex Agent, it is about taking opportunities and working!

Just pointless moaning about things, it will never improve your financial position, but then you have to be prepared to invest and work and take advice!

by Flying high | 27th Jul 24, 4:19pm 1722053947

Is 'ex agent' actually Gordon in disguise

by Zwifter | 27th Jul 24, 6:37pm 1722062222

I can see why a load of people on here are up shit creek without a paddle, totally worried about the wrong things like who the anonymous person used to be and twits just picking on your spelling. People that are successful focus on what actually matters.

by Flying high | 27th Jul 24, 11:56pm 1722081394

So you're triggered by that question but rant about being successful. Gee I really hope you dont have any spawn

by Zachary Smith | 28th Jul 24, 10:00am 1722117629

It's hard to take people seriously who don't know the difference between looser and loser.

by Zwifter | 28th Jul 24, 11:00am 1722121228

Like I said , twits....

by Hahashishi | 28th Jul 24, 12:23pm 1722126225

Working hard doesn't mean you are gifted with empathy. More often than not it is the other way around. Curious to know how you joined your dots.

by Nzdan | 29th Jul 24, 8:42am 1722199379

Those who crow the loudest about how hard they worked are usually trying to stitch together a fictional tale to justify their economic luck.

Anybody that truly worked hard for their wealth or success, will be most humble about it and won't crow to strangers on a financial news website.

by Flying high | 27th Jul 24, 12:15pm 1722039310

After reading the whole article the woman buyer sounds dodgy as sin

by HouseMouse | 27th Jul 24, 12:32pm 1722040351

Sure. But I don’t buy the agent’s case either

But yeah she didn’t help her case at all

by 26@Main | 27th Jul 24, 3:29pm 1722050947

Odd case, is an agent obliged to tell a prospective buyer who lives next door to a property, gang member or otherwise? Surely it's a buyer's responsibility to find out. At the very least she could have looked at Google Street view although maybe she doesn't know it exists.

by wingman | 27th Jul 24, 4:51pm 1722055901

I agree. There could be a wreckers yard nearby that could catch alight, or a halfway house where doped up dero's roam the streets.

The possibilities are endless.

by kiwikidsnz | 27th Jul 24, 5:33pm 1722058427

AFAIK the legal disclosure obligation the vendor has relates solely to known issues with the property actually being sold.

Agents "obligations" outside any legal compliance would be a matter for their conscience, good luck with that.

by HouseMouse | 27th Jul 24, 5:38pm 1722058717

Surely if that was the case the tribunal would have said that, and it would be a simple case and argument over.

The fact they seemed to go into a lot of detail and consideration as to whether or not the agent really knew a gang was living next door suggests there is, or could be, a duty of disclosure.

by HouseMouse | 27th Jul 24, 5:41pm 1722058861

Rule 6.4:

https://www.rea.govt.nz/real-estate-professionals/disclosures/disclosur…

by 26@Main | 27th Jul 24, 6:45pm 1722062755

Yes, cheers, I should have Googled it before I asked as I found the same, useful for others to know. Also found an article about an agent found guilty of misconduct for not disclosing a gang pad next door, it would be interesting to know what the penalty was.

https://www.stuff.co.nz/business/125761541/agent-guilty-of-misconduct-for-not-telling-home-buyer-of-gang-pad-next-door

Edited to add: https://www.nzherald.co.nz/nz/family-sues-real-estate-agent-over-non-disclosure/FWKBT4WTVHMT2BZPWANKOEBLKA/

Both Robson and his agency were fined $5000 but the authority did not award compensation to the family. The complainants have now filed civil proceedings in the High Court seeking financial damages relating to lost value, "stigma" and distress. They allege misleading and deceptive conduct under the Fair Trading Act, and negligence under the Real Estate Agents Act. If successful, compensation could run into the hundreds of thousands of dollars.

Buyer beware - take a walk in the neighbourhood without the agent and maybe knock on a few doors.

by kiwikidsnz | 27th Jul 24, 9:29pm 1722072546

Thanks for your & 26@main efforts to clarify. Good to know.

by HouseMouse | 27th Jul 24, 9:35pm 1722072956

In my mind it raises all sorts of questions around what should or shouldn’t be disclosed. Seems a real can of worms

by K.W. | 28th Jul 24, 4:19pm 1722140365

I once saw patched gang members hanging around outside my neighbours house. Does that mean its now a "gang house"? Never saw them again. So obviously not. And now that there are gang members everywhere, its going to be pretty hard to avoid running into one.

by IT GUY | 27th Jul 24, 7:39pm 1722065940

$1 res sold 11k

https://origin.raywhite.co.nz/auckland/auckland-city/auckland-central/C…

by HouseMouse | 27th Jul 24, 8:17pm 1722068266

Wonder what the ground rent is

by IT GUY | 27th Jul 24, 8:44pm 1722069848

at 11k.... lots

by HouseMouse | 27th Jul 24, 8:47pm 1722070072

Yeah

and who knows in the future

surely a liability not worth paying even a dollar for

by CN - new | 27th Jul 24, 10:50pm 1722077412

Ownership costs on this 3 BDRM in the same complex were $23,000.

Need to know when ground rents are up for renewal and what they could be as well as body corporate costs for repairs and maintenance.

If costs remain at $23,000 level, it could mean net annual cashflow after operating expenses of $7,400 before tax on a purchase price of $11,000.

If costs rise by 32% or more, then the cashflow potentially becomes negative.

https://www.oneroof.co.nz/news/cheap-and-cheerful-train-station-apartme…

by Flying high | 28th Jul 24, 12:04am 1722081856

Homes in St Johns get low prices for the same reasons, leasehold is broken.

by CN - new | 28th Jul 24, 7:17am 1722107866

"$1 res sold 11k"

Did the previous owner experience a 7.2% p.a growth in price from their purchase price? (i.e the growth rate required for prices to double every 10 years)

by HouseMouse | 27th Jul 24, 8:26pm 1722068797

1.95% mortgage rate for one year! This developer must be getting a bit desperate to offload homes.

The banks will still need to stress test at 8.5~9% though won’t they? So not sure how effective this tactic is. And buyers will need to be confident they can afford circa 5-5.5% in a year’s time.

https://wirihana.co.nz

by Averageman | 27th Jul 24, 8:34pm 1722069265

Funding another to become banks risk patsy. Despite indeed.

by Flying high | 28th Jul 24, 9:45am 1722116725

Pete wolfkamp on zb discussed Land 400k and construction cost 750k. From those numbers I see that construction is the issue and land is no longer the issue. Also how does the average young couple afford 1.15million.

by stefanblaise | 28th Jul 24, 6:34pm 1722148476

Who says it's on the bottom? Plenty of soil to keep digging this hole.

by NZGecko | 28th Jul 24, 7:23pm 1722151432

No way in hell has the market bottomed. Impossible.

We are almost midway in this major Housing crash. We are at the point of the after top, dead cat bounce-Return to Normal, then the Real down leg takes center stage next, at pace.

https://www.tradersmagazine.com/departments/equities/data-reveals-the-s…

The currently still highly elevated prices need 3.5% mortgage rates, to see any life, or asset inflation.