By David Hargreaves
Auckland's biggest real estate firm is reporting that both its median and average prices slipped in November, while the number of listings it has on its books is now the highest in nearly four years.
Barfoot & Thompson's managing director Peter Thompson said that after seven years of constantly rising prices, November’s sales data pointed to the Auckland housing market "turning" but he felt it remained "well positioned to achieve a soft landing".
This is happening amid a backdrop of the new 40% deposit rules for investors introduced in October by the Reserve Bank and also amid increasing evidence that the banks, faced by flagging levels of inbound deposits from savers, are starting to 'ration' their lending.
Thompson said that signs the rate of price increase in Auckland had been slowing have been there for some months "but November’s sales data confirms that for the time being at least, Auckland prices have stopped rising".
Barfoots typically accounts for about 40% of Auckland's house sales.
The average sales price in November at $933,130 was down 1.1% on October’s and "only" 1.1% higher than the average price for the previous three months, Thompson said.
The median price at $850,000 was down 1.7% on October’s and down 0.6% on the median price for the previous three months.
“What puts November’s lower prices into context is that November and December are traditionally when prices peak for the year, and this is the first time in eight years that November’s average and median sales prices have been below those for the previous October," Thompson said.
“Encouragingly new listings at 1879 have been strong and sales numbers at 947, while down marginally on the same month last year, were sound and up 21.7% on those in October.
“The market is not over reacting to the changes occurring."
Thompson said clearance rates under the hammer at auctions were 30% in November with another 20% being sold in the 24 hours following auction.
Barfoots doesn't always specify what the auction clearance rates are in its monthly reports. But in July it did report that 70% of its sales then were under the hammer - so the drop since has been considerable.
Commenting on the November auction figures, Thompson said those sellers "who were realistic and prepared to trim their reserve price achieved sales and buyers were confident in meeting near record prices".
“With 3881 properties on our books at the end of November, properties for sale are at their highest since February 2013."
Barfoots' available month-end listings figure is the highest for a November since 2011 - at which point there were over 5000 available.
Thompson said in the latest month sales of properties in excess of $1 million remained "strong", with 377 or 39.8% of all sales exceeding the $1 million mark, marginally higher than the 39.2% $1 million sales represented in October.
Properties sold for under $500,000, at 73, made up 7.7% of sales.
We welcome your comments below. If you are not already registered, please register to comment
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.