Harcourts reports falling prices

Property

Harcourts reports average house prices fall across the country despite a rise in sales volumes in all cities except Christchurch

12th Jul 11, 7:11pm by Bernard Hickey

Nationwide real estate agency group Harcourts has reported average house prices fell across the country in June from June a year ago, although sales volumes were stronger than a year ago across all areas except the quake-hit city of Christchurch.

Harcourts, which is the biggest agency group outside of Auckland, is the second chain to report its figures after Barfoot and Thompson, which is the biggest group in Auckland. See Barfoot's report for June here.

Government owned valuer QV has reported house values rose slightly nationwide in June from May, led by Auckland, but were down around 0.9% from a year ago. See the QV report here.

The Real Estate Institute of New Zealand, which includes sales results for June from all of its members including Barfoots and Harcourts, is due to release results later this month.

Harcourts said signs of a recovering real estate market had been tainted by "a potential housing shortage crisis"

"June figures show increased activity in the lower end of the market with written sales increasing due to better buying conditions," Harcourts CEO Hayden Duncan said.

"The national average volume of new properties entering the market is down 13%, reducing the already scarce pool of choice for buyers by the elimination of over 5,100 homes in national circulation from the Christchurch market," said Duncan.

"Given this, the time to sell really is now and buyers should act before a decrease in affordability arrives," Duncan said.

Harcourts figures showed property on hand in the Northern region rose 1.9% in June to 3,194 from a year ago and written sales rose 30% to 451. The average price fell 2.1% to NZ$480,609.

Central region property on hand fell 17.3% to 2,863 from a year ago while sales volumes rose 6.2% to 276 and the average price fell 6.2% to NZ$334,073.

Wellington property on hand fell 3.1% to 2,511 while sales rose 2.5% to 291 and average price fell 2.1% to NZ$336,788.

Christchurch property on hand dropped 16.2% to 2,811 and sales fell 21.8% to 341, while the average price fell 10.7% to NZ$378,224.

South Island Provincial listings rose 4.3% to 2,710 and sales rose 13.7% to 216, while the average price fell 6.4% from a year ago to NZ$306,450.

"With many Cantabrians relocating, increased sales activity continues in the South Island with written sales up 13.7%," Harcourts said.

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17 Comments

by Matt in Auck | 12th Jul 11, 8:41pm 1310460062

This and the QV report essentially show a stable Auckland (for now) and a pretty weak rest of NZ

I'd expect Auckland to weaken, and rest of NZ to continue to struggle (maybe Hamilton might rebound slighlty once the dairy money filters through)

by SK | 12th Jul 11, 8:55pm 1310460900

"A decrease in affordability". An odd turn of phrase.

It seems like he uses a random quote generator.

by BigDaddy | 12th Jul 11, 9:38pm 1310463480

A fall of 2.1% in the main centres of Auckland and Wellington over 12 months! !

Now that's a real crash for you.

A 30% fall - as predicted by BH and others must be just around the corner.

by SK | 12th Jul 11, 10:33pm 1310466794

Well, it just says the 'northern region' it doesnt appear to specify by city - in fact this Harcouts analysis is pretty hopeless really.

by steven | 13th Jul 11, 7:48am 1310500135

Try reading what BH said...

Im not aware anyone said 30% in say 1 year....though its possible...a Depression can be hard and fast, even then it seems to be 10%+ per year, so it could when it happens take 3 years to correct. Longer term houses are simply over-valued....so the risk is they will correct to where they should be 50% of their present value....

2.1% fall with core inflation at 2% or CPI at 4.5% == 4 to 6.5% loss and that is just the main centres.

regards

by FYI | 12th Jul 11, 11:17pm 1310469431

"Given this, the time to sell really is now and buyers should act before a decrease in affordability arrives," Duncan said.

In other news --- In a bold move designed to prove that he knows what he's talking about when it comes to real estate trends, Harcourts CEO Hayden Duncan last night sold his red racing bike for $1000 on Trademe and bought the same model in green for a similar price. After the exercise Duncan again thanked his similarly wise franchisees for contributing part of their profits to his well deserved 6 figure salary and gleefully declared "It's a great time to buy and sell bikes too".

Sources speculated that Duncan's wide influence caused Fairfax shares to rise 2% in late trading

by Your Landlord | 12th Jul 11, 11:49pm 1310471340

Oh come on now. This is getting tedious guys.

The NZ Herald today has a big headline saying house prices in Auckland are damn near higher than ever. This report says prices in the northern region fell a whopping 2.1%.

But it all does nothing to prove right the many punters on interest.co.nz who have been saying for (insert years here) there is a big collapse on its way.

So I have to put up with another month of predictions by many punters on interest.co.nz saying there is a big collapse on its way.

Bernard...this is getting boring. Can you do something please to speed this collapse up, so we can get people off the predictions topic and on to something else.

Nick, Wolly et al...tell me when the collapse is here. This web site is getting boring guys.

by steven | 13th Jul 11, 7:34am 1310499293

URL?

So core inflation is 2%, so that is a 4% (ish) loss this year, if you want to use CPI that is 6.5% loss....plus cherry picking some data is not the way to look at where the overall market is going to go medium and long term.

Looking at just the market to predict just what the market will do when the external factors dominate what happens to the market is frankly incompetant.

regards

by Steptoe | 13th Jul 11, 9:48am 1310507333

Really get sick of ppl who read headlines as the content of the actual prediction/opion.

Yes the market was identified as being approx 30%over valued on 3 sets of funimentals..

Yes ..Considering such a historically high overvaluation a drop was predicted...and that was predicited..from memory goung thru to around 2018....at which piont the funimentals would show correct valuation of the market.....

This consisted of an intial drop, which happened, depending on what section of the market varied from over 30% down to 5%...The change in the type of houses being sold as the market bubble/boom colasspesed also varied, distorting the overall means and Aves.

And yes this flat period was also predicyed...

So with some due respect, ppl stop opening your mouths up to show your compentence at only reading headlines and changing feet.

by Your Landlord | 12th Jul 11, 11:53pm 1310471580

Sorry guys...the continual 'predicting' and never actual 'happening' is boring me so much I posted twice in my 'dazed and bored' state of mind.

Still waiting for that collapse...

by steven | 13th Jul 11, 7:36am 1310499362

Why come here at all? you could go be prozaced somewhere else..

regards

by Your Landlord | 13th Jul 11, 1:17pm 1310519851

Hi steven. I visit this site to check your responses. An iron law of the property market is the more you complain the healthier the market.

So far, my law has proved 100% accurate.

Regards.

by Kunst | 13th Jul 11, 12:16am 1310473002

Bernard - I think property prices do not fall significant, because of strong demand for immigration of rather wealthy people from troubled countries/ continents and the fact New Zealand needs them to lift it’s economic performance. (see also farms)

by steven | 13th Jul 11, 7:41am 1310499689

"Strong demand for immigration of rather wealthy people from troubled countries" proof? Lets examine that, if so Auckland and the "good" areas will maintain prices, there is no reason that other areas of NZ will not stagnate or fall... Wealthy lift economic performance? what rot...if the wealthy are not producing a good and creating jobs and exporting they are not adding to our economic performance or social need. They might if they are REAL business ppl, but if they invest in property or hedge funds they are actually damaging us.

regards

by Kunst | 18th Jul 11, 8:39pm 1310978348

Here they come :

Wealthy Britons prepare to flee

http://www.guardian.co.uk/uk/feedarticle/9747905

by Muppet King | 13th Jul 11, 10:55am 1310511305

I thought they were going up??? Or doing a "sideways shift"?? Lol I have tonnes of investments that do "sideways" shifts. Not.

by Rob of the North | 13th Jul 11, 5:46pm 1310535980

Here's a region by region breakdown from Harcourts:

Northern June 2011 June 2010 % Change New Exclusive Listings 421 400 5.3% New Auction / Tender Listings 83 107 -22.4% Property on Hand 3194 3134 1.9% Written Sales 451 347 30% Average Price $480,609 $490,964 -2.1% Auckland is clearly leading the real estate market recovery with a 30% increase in written sales against June 2010 also reflecting Harcourts continued growth in market share. Central June 2011 June 2010 % Change New Exclusive Listings 254 363 -30% New Auction/Tender Listings 71 74 -4.1% Property on Hand 2863 3462 -17.3% Written Sales 276 260 6.2% Average Price $334,073 $356,141 -6.2% A 17.3% drop of property on hand and a 30% decrease in listings has combined with a mere 6.2% increase in written sales this month adding to the scarcity of available property. Those thinking of selling should act now as this scarcity of homes is showing an upward pressure on prices. Wellington June 2011 June 2010 % Change New Exclusive Listings 315 343 -8.2% New Auction/Tender Listings 76 98 -22.4% Property on Hand 2511 2590 -3.1% Written Sales 291 284 2.5% Average Price $336,788 $343,874 -2.1% Wellington has seen one of the smallest decreases in its average sale price compared to other regions. A slight increase in written sales of 2.5% for the month and a small reduction in available property reflect the trends reported in the Auckland market over previous months. Christchurch June 2011 June 2010 % Change New Exclusive Listings 509 694 -26.7% New Auction/Tender Listings 73 99 -26.3% Property on Hand 2811 3353 -16.2% Written Sales 341 436 -21.8% Average Price $378,224 $423,520 -10.7% The impact of zoning and further damage to the region has seen all figures down this month showing a reduction in availability of property on hand, sales, tenders and prices coupled with the removal of 5100 properties from within the region. South Island Provincial June 2011 June 2010 % Change New Exclusive Listings 264 307 -14% New Auction/Tender Listings 35 42 -16.7% Property on Hand 2710 2599 4.3% Written Sales 216 190 13.7% Average Price $306,450 $327,266 -6.4% With many Cantabrians relocating, increased sales activity continues in the South Island with written sales up 13.7%. The average price has eased slightly on June 2010’s figures but is still up against MarketWatch June 2011 figures. With property on hand up 4.3% sellers are realising the reality of the Christchurch influx.

Aaah

, nothing beats the smell of freshly-buttered real estate porno,eh !