By Bernard Hickey
The BNZ-REINZ monthly survey of real estate agents in September has found more first home buyer inquiries, higher auction clearance rates and firmer agent perceptions about future prices.
BNZ Chief Economist Tony Alexander said the survey results showed the real estate market had slowly strengthened in favour of sellers over the last month, although there were possibly seasonal signs emerging of new supply about to hit the market as the Spring and Summer weather arrived.
"All of the main eight measures we use to gauge the current strength of the residential real estate market around New Zealand have strengthened over the past month, indicating that slowly but surely on average things are shifting to a sellers market," Alexander said in the monthly BNZ-REINZ survey of 561 real estate agents.
"More and more first home buyers are appearing, prices are perceived to be edging upward, and auction clearance rates are considered to be improving," Alexander said.
"However there has been a sizeable lift in potential vendors seeking appraisals of their properties, and in the opinion of agents the market balance is only marginally in favour of sellers. Regional variations remain strong," he said.
A net 31% of agents said they were seeing more people going through open homes, which was the strongest result since the survey started six months ago, although Alexander noted the survey had only been running for six months and would take a couple of years of results to get a feel for how much of this move was seasonal.
"Regardless, the trend from June, in the depths of Winter, is fairly clear. More people are kicking the tyres," Alexander said.
A net 31% of agents said buyers were following through to complete written contracts, which was the strongest on record, while a net 21% said auction clearance rates were rising.
More sellers appearing
The survey also found a net 31% of agents said more vendors were coming forward and seeking appraisals, which was a continuation of a trend seen since June.
"This result could simply be the result of Spring starting, or it could represent one of the waves of vendors we suspect could appear as the market improves."
Alexander said the survey showed little serious evidence that more rental property investors were looking to buy, apart from in Auckland, where Asian investors were seen to be more active.
Agents reported an increasing number of first home buyers, with a net 37% seeing more first homers, while a net 23% perceived prices were rising.
"This measure has turned sharply in the past three months when compared with the three month period ending in June. Back then most agents felt prices were falling," Alexander said.
A net 5% of agents believed buyers were more motivated than sellers, indicating they believed the market was swinging more to being a sellers market.
"But at a net 5% positive the latest result is low and not suggestive of sellers being able to flick properties quickly for strong prices."
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