By Bernard Hickey
Auckland's largest real estate agency group, Barfoot and Thompson, has released sales figures for April showing a drop in the number of sales and the average price from an exceptional March, but activity is moderately ahead of the same month a year ago.
Barfoot and Thompson Managing Director Peter Thompson said the figures for April showed the Auckland market's surge in March had depth.
Barfoot and Thompson reported it sold 723 properties in April. This is down 32% from 1,070 sold in March, but is up 7.7% from the 671 sold in April a year ago.
The average price for properties sold in April was NZ$544,975, which was down 6.2% from a record high NZ$581,190 in March, but up 0.6% from NZ$541,486 in April 2010.
“The average price of $581,190 in March, a record, was always recognised as a one off occurrence,” said Barfoot and Thompson Managing Director Peter Thompson.
"However, with April’s average price being close to $3500 above that for April last year, and the highest average price we have ever achieved in an April, it shows there is forward momentum in prices," he said.
“In each of the four months of this year, the average price achieved has exceeded that for its comparative month of the previous year," he sai.d
“Other than for March that increase has been modest, but there is a pattern of small gains."
Barfoot and Thompson's figures are closely watched because they are first sales and price figures for the month ahead of next week's national figures from REINZ for April. Also, Barfoot and Thompson is the biggest agency group in the country's biggest market.
Barfoot and Thompson said activity at the top end of the market remained particularly strong with a third of all those homes sold having values over NZ$750,000. There were 52 homes sold for more than NZ$1 million, 8 more than in April last year.
Thompson said the number of new homes listed in April at 1,033 was down a third on those for March and February, and down 21.3% from April last year.
“There is renewed interest in the Auckland market at present. However, this was countered in April through a lack of new listings," Thompson said.
See the sales data by individual region within Auckland here at Barfoot and Thompson's site.
South Auckland, Eastern Suburbs and West Auckland sales were down 20% in April from April a year ago. Central suburbs were up 26% in April from a year ago.
ASB comments
ASB economist Chris Tennent Brown said the data showed the property market in Auckland remained tight with reasonable turnover and lower listings.
"The ratio of monthly turnover to total inventory has been declining since October 2010, and last month eased further to 7.0 from 7.2 in March. This ratio was as 14.3 during the weakest period of the housing downturn over 2008," Tennent Brown said.
The average sales price was boosted in March by a high proportion of expensive property sales, but the composition of sales returned to more normal ratios in April, he said.
"As a result, the average sales price recorded by B&T declined from $581K to $545K over the month. Average prices within the B&T data over the past four months are up 2% on the corresponding period a year earlier," he said.
"Given the tightness in the Auckland housing market, we expect Auckland house prices will post gains in the range of 4-6% over the year ahead."
Tennent Brown said the contained level of inventory, positive migration, lower interest rates and population growth were all positive for the property market in Auckland.
"We expect stronger price appreciation in Auckland than elsewhere, particularly given the tightness of the region’s market."
(Update adds more detail, Barfoot and Thompson comment, ASB comment, link to regional data)
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