Residential property becoming a buyer's market as rush of new listings and rising stock of properties for sale give buyers more choice

Residential property becoming a buyer's market as rush of new listings and rising stock of properties for sale give buyers more choice

The latest figures from suggest the residential property market is becoming more of a buyer's market.

The specialist property website added 13,069 new properties that were listed for sale in March, up 10.8% compared to February and up by the same amount compared to March last year.

It was the highest number of new sale listings the website has received in a March month in five years, and only the second time in the last 10 years that new listings in March have exceeded new listings in February.

In Auckland the trend was even more pronounced, with the website newly listing 4700 properties for sale in March, up a whopping 20.5% compared to March last year and the highest number of new listings it has received in the month of March since 2008.

Compared to March last year, new listings were also up in the Waikato (+15.6%), Wellington (+11.8%), and Canterbury (+15.4), but down in Bay of Plenty (-0.9%) and Central Otago/Lakes (-3.7%): refer to graphic below for full regional new listing trends.

The surge in new listings comes as sales volumes are declining and selling prices also show signs of weakening in many parts of the country, particularly Auckland.

That combination is pushing up inventory levels (the total stock of properties listed for sale) and giving buyers more choice. spokesperson Vanessa Taylor said it was good news for Auckland buyers in particular.

"More homes on the market is good news for buyers, with more choice and less competition for individual properties," she said.



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wow - Zerohedge just posted a story about Auckland's housing bubble with a link to You guys are famous.

Our Economies Run On Housing Bubbles

I read that ZH article, it is vary scary. I can only hope the whole world reads it and they stop coming here to buy our property

But there is also this, and this. Both of which are much more realistic (and local) than any ZH breathless click-bait article

And the explanation for falling home ownership rates across all of New Zealand ,which have accelerated in the past decade has nothing to do with affordability, and that the average age for FHB is increasing, and no longer sits in a 25-29 age group.

Thank you David, we have religiously followed Interest.Co for over five years now and find all your articles to be most informative. It is only recently that we have become so concerned with the state of affairs that we have decided to jump into the abyss and comment.

I wouldn't call it an abyss, I would call it an 'epiphany'. We've collectively joined up the dots and found that that the Auckland housing market has been largely inflated by foreign buyers fulled on easy credit and money laundering.

Thing is we can stop this and sail on without them, we simply don't need a false economy!

Shame you didn't follow Tony Alexanders advice and get on the ladder sooner rather than later...the best time to buy property is always right now.

The ZH article does raise a much wider question than NZ house prices: How sustainable is the global economy when it appears to rely on a never-ending series of bubbles to influence behavior. No disrespect to, but the suggesting than ZH is little more than clickbait does miss the idea of why that particular media touchpoint was established in the first place.

David is correct ZeroHedge basically propaganda for the Alt Right reader

Ha. Many of the readers might be Alt Right and many of them are not. Pretty much like the readers here at Some of the articles do have an Alt Right undertone but many of the authors do a better job than the MSM in reporting and discussing real issues. The article above raises serious questions that could be worth thinking about. Or is it too much to expect people to be concerned about anything more than the price of their house?

If nothing else the comments are hilarious and great entertainment

Zerohedge more than anything is a contrarian to MSM website, with a sensationalist theme. Some, but not all of the articles have a right wing libertarian smell about them. Obviously you need to engage the brain and have more than a few grains of salt when reading. However quite often they come out with stuff which is later proved to be correct.

Agree David - tongue was firmly in cheek with that comment. When I have my morning coffee I enjoy a little breathless click-bait from the Herald and zerohedge. But then I go to for some "point counterpoint" reason and analysis. It just wiggs me out to see them linking to you.

Yesterday an article about housing crisis deepening, today it's about becoming a buyer's market... So effectively RBNZ and the private banks started the bust part of the cycle and it shows and it doesn't matter who is in the government, they are still playing in the realms of the banks. Again, "Give me control of a nation's money and I care not who makes it's laws".

They need to keep the 'good story' - they must confuse everyone. There is a shortage and high migration. Yeah right...and all of those migrants have $1m to buy the house on the arrival date...
It is becoming clear who was buying and who is selling. Wait till the interest will rise and economy will slow down .. then it will be fun (or blood bath...)

TradeMe listings for Auckland dropped below 11,000 to 10,961 overnight.

O-M-Goodness! It is coming down...I'll sure be driving around my neck of wood today and see if I can spot more sold signs. Things are starting to turn...


You know when you two constantly piggy back comments within moments, it gives a lot of credence to the people who are questioning if you're one and the same person.

Yep! Check the comments here:

Both comments at 6:24pm yesterday. How can one person read a long post and type up a long reply within 59 seconds?

What kind of pathetic life can one person have that he has to script up conversations with himself online.

"DGZ" probably means Delusions of Grandeur Zach

Sorry posted in the wrong place

Double GZ - Please do not take this the wrong way, however I am a little confused as to why you need to constantly drive around your neighborhood to establish if properties have been sold or not if you are in IT . Also are you not worried just a little that you will be reported for prowling?

It's just a hobby of mine, simple as that. Talking about prowling, I just saw Mike Hosking and Kate Hawkesby (with their black labrador) stopping outside a mansion on Remuera Rd talking to RE superwoman Leila MacDonald. I wonder if they are talking about the current housing market??

Did Leila MacDonald have a tape recorder in her hand recording Hosking so she could replay it at a lower speed later on so she could understand what he said

OMG ! You mean Mike Hosking is still relevant there ?
How could this be in the worlds most desirable city ?

OMG yes, he is one of my many neighbours! You are a Hosk-fan by the look of it! He is from Chch after-all LOL

Wasn't he from Linwood? Auckland is welcome to him...

Who cares?

I am not really sure of the legal definition of stalking and the consequences of carrying out such an act , but there is probably a fine line between prowling suburbs and stalking persons of notoriety even if it were by happenstance

Just remember DGZ that they numbered only 9000 a month or two ago.

Have we reached the stage where the more naive and clueless take it off the market 'to wait until it comes back up'.

Think that might be happening to the Raglan market

Yeah, it goes up or down by 30-40 regularly. Micro movements not to get excited about either way, probably TM auction rollovers in there too. Nothing to start quivering about.

9,400 to 11,000 is a bit more of interest. Especially in the peak months of the year.

That is 39 houses sold in Auckland in one day according to Zachary. At that rate it is going to take 10961 / 39 = ~281 days (over 9 months) to sell the rest of them lol

....and now it's back to 10,990

Ads on trade me expire and get relisted constantly, only trends are of interest, not daily or weekly fluctuations...

Most of the new listings in the Rodney area appear to be new builds, what does that mean? Will the cost of building a new home come down?

Unfortunately the cost of building is not coming down as the construction industry is still overloaded. However you might be able to make an offer low enough that the developer or builder takes a hit. When I bought my house it was a new build funded by a developer. Any new builds they will be interested in selling to pocket the money and eliminate the debt associated with the build.

Thank you for your reply. We are in an unfortunate position of owning a piece of land whereby the only choice is to build a new house. Construction costs seem to be escalating at approximately $45,000 per annum (that is what we have been advised by housing companies). I suppose my question is this, if housing prices drop for existing homes will the housing companies/builders still insist that costs are increasing even though they are selling less in a deflationary environment, or will they simply limit the supply of homes so they can keep the prices high.

If housing prices drop for existing homes the cost to build will fall. During GFC falling house prices, meant there were virtually no spec builder houses, just some few and far between people commissioning houses for themselves. We built in 2009 and it was cheap, most trades including building company, aluminium windows, doors etc, priced at workers wages + materials with no profit. As suppliers just wanted to keep their workers employed rather than lay them off. We shopped for the building materials I arranged a trade account of sorts that was pre-funded so no risk of bad debt and got a big discount. Hope this helps.

Thank you, that is what we are hoping for and watching the amount of new homes by developers coming onto the market. What I am concerned about is if the government (whoever they maybe) decides that it would be a good idea to force immigrants or offshore buyers to build new (to protect the building cartels) then the cost of new homes will increase even more, which will put NZers that need to build in an even worse position. I think the only solution is to limit immigration.

Trying to build - does the land have certain covenants on it that specify dwelling size and other design elements?

I often find that these covenants serve only to inflate the build cost.

If they are particularly onerous - they are not ideal - as the stifle your ability to innovate and/or compromise as a means to bring down your build cost.

Kate - thank you for your reply. There is no covenant, but we found out that the building companies even charge their clients a fee for putting their sign out the front of your property. If one goes to a large building company they insist you use their suppliers as this is where they make the majority of their profit, of course they say they pass on the benefit of their being able to purchase in bulk, but this is a complete load of rubbish.

Good you have no covenant. Have you considered relocating a villa or other property - and then doing a major renovrtion once on-site? The firms who specialise in building renovations - we have used, for example, Smith & Sons;

seem to us to be far more reasonable and customer-focused than the larger building companies who have a 'brand' image that has to be supported through TV advertisement, etc. Maintaining those brand images/profiles cost lots - and as you have found, the brand is often more the focus than the customer/end product.

Hope it all falls in place for you! cheers.

The one thing we can say about Auckland Council is that they have been very successful in solving the Rodney housing crisis. Never again will the workers of Rodney be faced with a shortage of homes close to their job.

An Auckland housing crisis was created as a side-effect, but never fear Auckland Council is planning to solve this by building even more houses in Rodney. [/sarc]

There is definitely panic kicking in. And it is not full on. good.

I think all the investments/rentals etc. will become much harder sale. Good quality homes (that actually owners live in) not 'properties' will hold value.

I have compiled some statistics. Since the beginning of February TradeMe listings for Auckland have gone up by about 2000.
AK Central up 49%
Manukau up 21%
Waitakere up 60%
Papakura up 34%
North Shore up 53%

I was quite surprised about the low Manukau increase. Also with AK Central listings almost half (45%) are apartments.

Should have brought Fairfax shares in January Zach.

Bottom line, if there is a continued fall in prices the areas most affected nominally and in percentage terms will be the 'top end ' of the market.

I was buying some fruit and veges at the local Jack Lum this morning. I told them that there's a lot of noise about housing market is slowing, but they told me this is expected and will rise again after the election this year. Many of their customers are positive about the housing market we have at present when the subject is raised.

Well, clearly wealthy inner Auckland areas are likely to hold values, or at least not fall away much - unless 'Black Swan' event hits (then all bets are off). I think few would contest that. It's the 70-80% of Auckland that isn't such areas that is getting hit. some worse than others

Fritz ,why do you believe the 'wealthy' inner Auckland areas would hold there value

such areas have tended to do so, globally, when things fall away

Fritz, here are some numbers , leafy areas of Dublin. Average price 4/5 bed homes . 2006 2Q, North City, 1.26 M, South City 1.07M, North County 1.085M , South County 1.184M. 1st Q 2012, 519, 555, 558, 573. Few expected the fall, fewer expected the size of the fall in the leafy areas. Its where the debt is.

Those are very useful comparable numbers you got there, Cowpat. A lot of people don't realize that what happened to Ireland is very possible here in Auckland. Heck, wasn't it only a few months ago (say October 2016) that most people couldn't fathom Auckland prices falling? Many were in denial when the trend started in November 2016, but now that we have consistent data for the last 4 months (with March 2016 vs 2017 about to show a decline Year-On-Year) there's really no denying the bubble has popped. Only people denying now are just lying to themselves.

We are at a dangerous territory and could very well face dramatic drops in prices should investor panic set in. They were the ones that got us into the high prices, they will be the ones that will drag it back down to hhe low prices. Also, declines tend to happen at a much faster rate than it took to build up. So while not desirable, a full on crash is still likely possible.

Well...yeah...the fact is that local incomes cannot support these prices.

So that makes it abundantly clear that National's only plan to prevent house prices falling is to import more and more buyers to take houses instead of Kiwis.

National architecting the great sell-out of NZ out from under young and future generations of Kiwis.

That was also the Fianna Fáil plan in Ireland and prior to the correction Ireland had high net inward immigration. Didn't work.

John Key said he wanted NZ to be like Ireland. It's one of the few things he didn't lie about or marginalise.

Ireland had a construction boom that lasted a decade creating an oversupply of houses and commercial property. So that when the inevitable crash happened the economy of Ireland was able to bounce back on the basis of reduced rents and increased competitiveness.

John Key engineered a Super City that Len Brown sent into a land speculation boom. We have built nothing, when the crash comes we will be stuck with decades old houses and commercial buildings.

IT GUY, you should know that the search is more accurate if it has quote marks - "must sell". 171 listings in that case.

Election will be panicing the specuvestors. When to dump and run before Winston and Labour get in control indeed. Have you read their respective housing policys, as neither bode well for the speculation on the back of overseas cash which is the foundation of the bubble. A crash will be messy but NZ housing needs to return to normal investment metrics vs the mess it is now.

The time to go long in houses will be when the property press is half full of mortgagee specuvestors being cashed up by the banks. I note Aussie has just put a bullet in interest only specuvestor housing loans. If that follows here it flush out a large chunk of the late to the ponzi party.

New lending rules in Aussie:

If implemented here it would bring chaos to the speculators market with the flow on effect.

sort of kills off the negitive gearing potential if you have to actually make payments....

Worse. Negative gearig, having to make payments AND having a long slow slide in the property value.

We should be keeping a close eye on the Australian RE market as we are inextricably linked to it. If Australian prices drop dramatically then NZers wanting to return home may not be able to sell their house (Affecting net immigration and demand) or if on an income basis it becomes increasingly more affordable in Australia more people could leave NZ (again net immigration and demand). Not to mention the reliance of the NZ banking sector on Australia. Could be interesting...

The Australians have built a lot of office space, whilst Auckland has been stagnant. The Australians have built a lot of homes (apartments and houses), whilst Auckland has been stagnant.

If there is a global property correction, then Auckland is boned - jobs and employees will find everywhere a much more attractive location than Auckland.


Just went to the on-site auction at 3:00pm this afternoon for 24 Komaru Street ( and guess what, it was SOLD under the hammer for $2.91m, after some competitive bidding between 5-6 different groups plus a phone-bidder (mixture Europeans and Asians). I think there must be at least 8 - 10 groups on-site and a few RE agents plus the onlookers/neighbours. The bid started at $1.9m and went up at an increment of $50k till it reached $2.6m. Then we hit a long pause of about 10 mins where negotiation started between the vendor and the highest bidder at the time. Nek minit the house was in the market at $2.75m, and this was where the real bidding started between 2x groups of bidders until it reached $2.91m and sold. The winning bidder did a fist pump and a little dance on the Astro turf and everyone clapped; and that's the end of today's market report.

It's certainly great to see the auction with my own eyes today and defy any doubters on the DGZ market, which is still very much alive and kicking ;-)

Truly awful street appeal and a tacky pool and outdoor area. That would sit and sit and sit on the market here at an asking price of half a mil - yet in AKL the improvements value alone is $630,000! Valuation jack up post lipstick on the pig, me thinks. Rates are cheap though. No wonder you folks can't afford decent infrastructure.

I agree Kate, it is a no character 'shit box' so to speak. Even the front gate and fence are aluminium...very cheap and nasty indeed!

Of course it is the land, worth close to 3M just by itself.

According to the CV the land value is $1,420,000. Do you think it is justified?
I think the price paid today was a little's close to the high-end of the estimate.

Maybe the house can be bowled and two house built there and sold for 3M each giving the owner a million in profit.

You could be right there Zach. The winning bidders were a group of five and I would not be surprised if they were developers, but my gut feeling tells me it is a land-banking situation.

Kate, what are the rates ?

It's only around $6,000 per annum. Cheap as chips really.

will they double with the new value?

No, certainly not double as the Council has capped the rates increase to no more than 3.5%, but Auckland has a capital revaluation coming up in July this year (home owners to be notified in early Nov), and depending on the increase in value some might end up paying more than the others. I think the surrounding streets of this property will be affected by the selling price. It is certainly something that the valuers take into consideration during revaluation.

$5,936.06 in rates alone for that house. Zero possibility of being able to afford it on a NZ wage. No wonder New Zealanders are fleeing Auckland for the provinces, and to go overseas.

fat pat, Auckland rates for your premium suburbs/land are extremely low ... less than half what similarly valued properties pay in, for example:

Kapiti = $10,583

Palmerston North = $12,807

Wellington = $11,891

WHY? You might well ask!!!!

Well, you see when the Super City was set up by Rodney Hide and National they specified in the legislation that the rating base to be used had to be Capital Value (CV). The other option for the rating base could have been Land Value (LV), but using a LV rating base would have meant the Parnell's and the Remuera's and the Glendowie's of this world (in fact all of the old Auckland City area suburbs) would have had massive rates increases with the advent of the Super City, yes massive.

Because you see, the old Auckland City had its port income all to itself when it wasn't the Super City - and this additional revenue paid to the old Auckland Council subsidised/cushioned its ratepayers. But the Super City was going to mean old Auckland City had to share the port's wealth with "all and sundry" around the joined-up council.

In short, the old Auckland City ratepayers always paid lower rates than most other metro centres in New Zealand. And so the political masters who dreamed up this new Super City nirvana had to keep the cheap rates ponzi going for their inner suburb constituents.

Simple as that - the average man/women Aucklander continues to get right royally screwed by the ruling class, city elite. As I said to DGZ above (and she agreed with) - no wonder you folks can't afford new infrastruucture. And the real kicker is that the CV rating base massively benefits the land bankers - in other words, it was likely written FOR the land bankers as well as the posh suburb dwellers. The recent Productivity Commission report points this unfortunate situation out. There is nothing like a punitive tax to incentivise behaviour (think tax on ciggies for example)... but the Super City legislation locked out that possibility.

In thinking on this legislative conundrurm as pointed out by the Productivity Commission, I believe I have found a way around this legislative rip off that set CV up as the mandatory rating base.

It involves a slightly unorthodox (but likely lawful) use of the Local Government (Rating) Act as it is currently enacted (no legislative change needed). It kind of turns the CV rating base into an "LV-like" rating base by way of making use of a tool called a differential.

It has a slightly complicated little explanation and formula associated with it - but I'd be happy to explain it to Murray Sherwin (or Phil Goff), if they honestly want to deal to land bankers and underdeveloped properties (i.e., dumps on valuable land), not only in these inner suburbs, but everywhere.

One of Zach's posts below just coined a name for this alternate way of rating, I've called it a develop or pay through the nose tax.

Yes you're totally right Kate, Thanks for pointing that out- So the foreign buyers who push up the prices in affluent suburbs, contribute nothing, who quite often leave the houses empty, they also happen to benefit from comparatively low council rates. What a rort.

Allowing the council rates to increase (as you describe) while giving generous rebates to owner occupiers I think would go a long way towards fixing the issue.


My proposal for the application of a differential is that rates would only increase for those 'land banking' - i.e., holding onto vacant and/or under-developed land (by under-developed I mean a 'dump' on a valuable piece of land) in high value land areas.

Everyone else in terms of rating would stay the same (i.e., they wold not be captured by the differential rate).

Not only this, but what Vancouver has found is suburbs full of families declaring poverty-level local incomes (dad heads back overseas to run his business) while enjoying taxpayer-funded education and healthcare.

NZers being the patsies.

Because you see, the old Auckland City had its port income all to itself when it wasn't the Super City - and this additional revenue paid to the old Auckland Council subsidised/cushioned its ratepayers. But the Super City was going to mean old Auckland City had to share the port's wealth with "all and sundry" around the joined-up council.

Prior to the Super City the port was owned and operated by Auckland Regional Council, not Auckland City Council.

And the real kicker is that the CV rating base massively benefits the land bankers - in other words, it was likely written FOR the land bankers as well as the posh suburb dwellers.

Not really. The thing that favours landbankers in Auckland is that land prices has gone up by 300%.

If Len Brown or Penny Hulse hadn't decided to ban development at the edge of Auckland City (they prefer to build hyper-expensive sprawl in the far off distance) - the price of land would hot have increased by 300%. But since the future of Auckland is to have big sprawling development miles away from the City with everyone driving really long commutes - the price of land is very costly.

That house sold for 900k in 2006. That means it went up in price about $3,500 every week for eleven years.
On a more modest level, I went to an open home for a two bedroom brick and tile for rent in the week and it had about ten interested parties looking at it. Reports of the death of the Auckland property market are likely greatly exaggerated.

O.M.Goodness $3,500 per week of passive income GRRR - I wish I was the envy!

Haha yes it sounds scary doesn't it? It is equivalent to $182,000 annual income that is tax-free. There must be a lot of people who are sitting on gold mines in the zone at present.

Tell that to my nephew who took longer than expected to sell in Herne Bay and took a crew cut on his original purchase price. Don't believe what Zach/ DGZ is saying as he is winding you all up.

Gordon are you saying your nephew sold the house for less than he paid? I thought you said he was trading up which implies he was there for at least a few years.

Dp and wrong thread.

Yes he did DGZ. Only held it for a year and needed to go bigger as third child on the way.

I don't know how one can lie about these things Gordon. It's a B&T auction result and it can be traced and confirmed, but obviously now you have the first hand information as I have shared the news.

It looks like it has had a major renovation in the last 11 yrs and also the construction of the outdoor living/ poor area, this would have to be added to the sale price in 2006.

No mja the pool was already there prior to their purchase in 2006. They added the Astro fake lawn at the back, and about a year ago they had a decorator doing some minor interior work, including painting and re-gibing of less than $20k that's all (I know because I know of people who know them). However, they have an architect drawing of a new garage with internal access to be built in front of the house, and this was shown to the open home viewers.

P.s. Also they had the exterior weatherboard painted white at the same time a year ago. In the 2012 google street view you can see the weatherboard was chocolate brown.

This what it looked like in 2012 - Google Street View
Someone has spent a fortune tarting it up - not exactly a vibrant looking neighbourhood,174.8069911,3a,90y,90t/data=!3m7!1e1!3m5!1s_DU2eYUMxLNTwel2-Qik0A!2e0!!7i13312!8i6656!4m2!3m1!1s0x0:0x21d50a57c38982c4!6m1!1e1

Who cares how it looked in 2012. Moving right along, I am quietly excited about another 2x sales coming up:
1) 16 Combes Rd - Auction 6th April.

2) 33 Benson Rd - Expression of interest

Madness ... very cheap looking considering the price.

"In the market" so does that mean your British DGZ? It's generally referred to as "on the market" in NZ, unless you've been watching too much "Homes under the Hammer"?

Buyers - your time has come, after a fairly long wait. But don't necessarily expect the current window of opportunity to last indefinitely. The tide could turn again after the September election.......

Sellers - don't sell in the current market unless you're forced to do so. And avoid the auction method like the plague! Advertise at a realistic fixed price and be prepared to wait a while for offers....... Patience is a virtue!

Interest. co swallowed or infiltrated by a Barfoots agent. If there was a story on poverty, DGz would be there giving price updates, infatuated by a single real estate agency.. Interest .co already has an auction section, updated weekly.

Cowpat I am not a RE agent. I work in IT and am ITIL and PRINCE2 qualified and I commute to work in the CBD Mon-Fri by train. It is not important please don't get carried away. We need to move on from this.

Check out this nice place that just sold the other day for close to three million (2.93m)

Perfectly illustrates how expensive the land is. Mind you two 3m+ houses could be built here netting the new owner a cool million for six months or so work, subdividing and managing the building of the houses.


A prime candidate for my clever use of the existing rating tools to sort out your infrastructure problems!!!!

I would be able to make you Aucklanders a FORTUNE in additional rates on these speculative buys. It's a sort of develop or pay through the nose tax.

Kate, where are you based? You're not in Auckland going by one of your recent comments..

Palmy North.

Kate, if land is really that expensive, then why is the asking price so high (>$1.7m) for this tiny 328sqm land in Mt Albert?

Here's the valuation:

Latest capital value = $1,200,000
Latest land value = $500,000
Latest improvement value = $700,000

The improvement value there is 140% of the land value - so the land with respect to that property is well utilised and wouldn't be subject to the differential tax (as it does not meet the threshold of the VI being equal to or less than 20% of the overall value).

That's a great example of the way a differential would encourage maximum value land use. I'm assuming that section was recently re-developed. So the land value itself is still high on a per m2 basis, but as the property is on less than 400m2 - the land is well utilised.

And most importantly, ACC is collecting a far more equitable rate now that the land parcel has been re-developed.

That is not a house. That is a dog box.
3 mill.? I got a Londod bridge to sell. Jesus

Whoa $2.93m for that ugly box!! But mind you the land is over 1,100sqm so you can do alot with it. Also the use of words in this listing is clear that the agents are targeting the developers...

"Reap the rewards by developing, land banking or renovating to take advantage of this proven growth area - the choice is yours! The Unitary plan zoning is Mixed Housing Urban which allows for multiple subdivision (subject to council approval)."

Yeah although a chunk of land will be used for the driveway. I think the house that sold the other day, just around the corner from this place, set a precedent by fetching close to 4m for a new build on half a section. If this property can build two houses for another 2m of investment and then sell them both for a combined total of 6,7 or even 8m it will be a #GoodBuy. Theses houses will be quite private and have good views.I will be watching closely to see what happens.
It's a phenomenon that illustrates that the money is to be made in the high end development.

When you say half section do you mean they have been subdivided or in a cross-lease situation? I agree with you, and it is happening in Remuera too where lands have been subdivided to build multi-million dollar properties...a lot of the viewers here will not like that as they might think it is out of reach of an average income earner. I have noticed a couple of houses being listed for removal in my area, one of them was sold for $2.5m last year. I am pretty sure high-end houses will be built on these lands.

Subdivided. The case in question was two cross-lease properties which I think were then properly subdivided into freehold properties. I think we will see a lot more of this happening until the market becomes saturated with high end properties.

Clever thinking. I know for a fact that there are still many high-end buyers out there. The under bidders from yesterday's auction all bidded up to around $2.5 yesterday with one at $2.90 and still lost out. You have to wonder which properties they will put their money in next.

That is the kind of re-development we want to see as a society for these properties. The reason being that under the CV rating system, everyone benefits from the higher rates paid once the property is re-developed - whether by subdivision and single unit dwellings or by way of multi-unit, unit title dwellings (i.e., low rise apartments and townhouses).

Under this type of re-development, there are more rates revenue generated for the same parcel of land and this means the ACC is more able to afford the infrastructure required to grow out into greenfields type development in fringe areas.

Intensification benefits everyone.

Yes I agree Kate. Rather have properly built houses sitting on the land than a derelict empty shack to be honest. However, the point is that the new builds are likely to be high-end and would fetch somewhere between $3m to $5m each...a lot of people actually don't think they are affordable.

To illustrate this, the following 2 houses were built on a piece of land that previously had a bungalow on it.:

20 Raumati Rd - Sold Jun-2016 for $3,750,000

18 Raumati Rd - Sold Oct-2016 for $4,560,000

Affordability isn't the issue being addressed by my differential rating proposal. The most affordable dwellings close to a CBD will always be multi-story inner city complexes (high rise apartments). So if these land parcels aren't capable of providing for that kind of high rise re-development - then high end single family dwellings on smaller parcels of land are (in my opinion) the optimum use for that land - as well as the best revenue the ACC can get from them in terms of rates under a CV rating basis.

Did you look through these DGZ?

I looked through the front one last year, these are absolute top end builds. The all up build costs were probably well north of $6000/m2 of floor area. From memory that front one was 400m2 plus, so I suspect there wasn't too much change out of $2.5 or even $3m excl land.

There is no way a townhouse on a site without the spectacular view is going to achieve $4m plus, especially without an Epsom or Remuera address.

If someone tries to develop 2 $3m homes on that Greenlane site, there is not a lot of margin if any (a $1m paper profit will evaporate quicker than you could believe on a project like that). I would suspect someone will aim for trying to squeeze in maybe 3 or 4 units under the new unitary plan, or will just land bank hoping for a bigger fool to pay more. Unfortunately for the buyer this is the top of the cycle, so it is a risky enterprise.

The all up build costs were probably well north of $6000/m2 of floor area.

That sounds a bit steep. I would have thought more like $3000/m2, especially for two stories. Anyone else like to comment which figure is most likely to be right?

This house built for 450k in West Auckland:

I know not top end but imagine if the budget is 900k?

Also this:

Zach, you're not really involved in property if you don't have a grasp of construction costs...

Firstly that West Auckland house, the article says $450 was the budget for their original smaller plan, I imagine it would be about $3000 a metre for that type of building if you really skimped.

Note those tradebox estimates are about $4500 for a top end house, throw in the landscaping, drives, a pool, gates etc etc and it will easily ramp up to $6000 a metre, then don't forget professional fees, engineers, architects etc could be in the hundreds of thousands on a project like that.

Raumati, was definitely top end and would have been mid $2s to build at a minimum.

Hey yes I did view both properties when they were open. The front one took longer to sell but it was sold nevertheless (to Chinese *ahem*). I am with Chris_J for this, it is north of $6000/sqm build costs and it is not unheard of however these developers are doing a few at one time so they might get economies of scale savings from some of their suppliers.

I'm sure you can build a very nice house for under $1M. I've seen it done, several times, spoke to the developer. They did say the profit wasn't that great but at the time bought a full section for just over a million, built two houses and sold them for 2m each. They might have made more if they just land banked. Risky business though and one shouldn't begrudge their profit if they do build.

*As a very rough starting point, $1500 m2 is very cheap, $2-2500 m2 is more usual and then anything from $3000 m2 and up is more consistent with bespoke designed houses.

Crazy to go too bespoke. Just keep to a nice standard and don't get too carried away. Nice shape, nice appliances, good roof and cladding, great location, is all you need. Stay away from "arty-farty".

You sound like a Philistine, Zach...

Buyers in the upper end of the market demand property that exudes quality and style. You don't spend $4m to live in a house that cost $1m to build. In all honesty some recent migrants from east Asia don't realise this and build speculative rubbish in expensive suburbs that has no appeal to local buyers, hence they often get sold only to other migrants or simply don't sell.

There is no doubt $1m will build a very nice house, just not one that sells for over $4m in Raumati Rd...

Guilty as charged as being a bit of a Philistine. I have never been involved in building or even major renovations so this is quite revealing. I sort of intuitively know that all the hassle and spiraling costs are not for me. Certainly have seen those new houses built by Asians although they do seem to other Asians. Reading again the article about the house in West Auckland and I see that it doesn't seem to give the final cost of the build and yes it must have been more than 450k - why the hell don't they have the final cost?
Thanks for enlightening me about this. I wonder if smaller houses, 150-180/m2 but costing $6000/m2 would be viable? I recall seeing something about high end mini houses becoming popular overseas.

There are plenty of smaller luxury town houses being built in inner suburbs. 180m2 for a $1m say.

200m2 town houses that look fairly basic are likely to cost over $500k all up. An ultra basic spec t/h of 120m2 is still likely to cost over $300k all up. The only low cost options per sq m are larger basic single storey brick and tile type houses on a flat site that may come in around $1500 or below a sq m but this will have lots of add ons or just be the cost of the basic house. Even your small 90m2 al cheapo group housing type of thing is costing $1500 or more per m now.

You sound an awfully lot like Zachary, Double-GZ! ITIL Information Technology Infrastructure Library, basically an IT support role with a bit of management and not very well paid. Hey you can be PRINCE2 credited in just 3 days.

I don't doubt that you work in AKL CBD as so do I. But frankly chaps, I'm better qualified than the two of you put together and then some. If you're not an RE then why do you keep fluffing AKL's housing market beyond all reasonable logic?

I'll have you know I'm NT4 certified!

LOL Pha!!

I used to have an NT box. I would have thought it is an old technology?

Yeah you don't see many NT4 boxes around now. Speaking of technology I just upgraded my main commenting PC to solid state disk for only $80. Should be able to get those comment replies down to less than 59 seconds now. For those who want to do this download Reflect backup software which is free for personal use and perfectly restores your PC to even a smaller sized disk and trims it for SSD.

I'll upgrade to one that will allow me to reply on comments in less than 20 seconds. I don't mind paying more LOL
By the way I'm going to the open home for 23 Empire Rd in Epsom today to get a feel of the market in one of my favourite streets in Auckland...see you there?

you know you have embarassed a troll when their comments have shifted from trolling to trying to cover-up their commenting missteps and pumping up their fake backstory

SSD's are not exactly modern technology - most laptops and notebooks have them - I put them in my network 3 years ago - dropped an NT box 6 years ago

SSD's are not exactly modern technology

What is modern though is their affordability. You can now get a 120GB drive for $67. I recommend using SSDs for older notebooks and laptops. Keep the old drive as a backup. That way you can stay online to read

Double GZ works in the back-office IT department of Barfoot and Thompson which gives him/her immediate access to the data which manifests itself in DGZ commenting within seconds if not before general publication in the NZHerald or

This has got to be the joke of the century! Just fell off my chair laughing LOL

In that case, we know your potential earnings in Auckland.

Which highlights just how lucky you were to be born at the right time, compared to young Kiwis coming up now.

So were you.

If you are not an agent why do you keep talking about being excited by sales and providing links to properties?
Sounds suspiciously RE agent-like to me.
Or you have a pretty narrow and boring life?
Who gets off on consistently posting on RE sales and auctions?

RE is my hobby and I do a lot of research on this topic especially in my own area (yes I am a home owner here). When I am free I like trawling through all the listings mainly on TradeMe and figure out what they will sell for etc. So yes in that sense I am very RE agent-like, and I am sorry if I have misled you that I am a RE agent (I quite often say I am not working in the RE industry). Zachary would understand me...

In my opinion I think it is beneficial to report on trend and what I have observed out there as this is part of the Auckland housing market. A lot of people do not agree with my findings because I have the opposite viewpoints from what they believe in, and the same applies to Zach. They will try to shut us down by accusing us being the same person, that we are hired by Barfoot & Thompson etc etc instead of having a healthy debate with us.

Nice try Zach but more and more of us do not buy it.You and DGZ are one and the same person. Give us a rest " please. "

We have you surrounded again gordon. Look we are basically just reporting what we see on the ground. We are the amateur Auckland Central reporters.I know you think we lack empathy but our advice may well help someone make money.
What good is it to anyone to simply express sympathy with just kind words and commiserations?

Keep the housing supply under control seems to be the solution and is exactly what the banks and governments are working towards. Raising interest rate to slow new developments and LVR to keep people from purchasing their own home and keep them renting.
New housing supply will be drip fed when the timing is "right" again....

Another comment thread that has turned into (highjacked by) the Zachary Smith and Double-GZ show...


Well it might be high time to start to look at investing in assets other than property which has so many issues and now seems to be on a downward spiral in NZ.

Though if you invest in art which is usually hassle free, make sure you don't put it full display or you could end up with this weekends recent events in Parnell:-

Herald article: Million-dollar Parnell art heist: Interpol on watch for thieves

Apparently it was a smash and grab.

Oceania's Eleven

Taika Waititi as Danny Oceania
Jemaine Clement as Rusty Ryan
Bret McKenzie as Linus Caldwell
Oscar Kightly as Basher Tarr
Temuera Morrison as Frank Catton
Sam Neill as Saul Bloom
Kim Dotcom as Reuben Tishkoff
Jono and Ben as the Molloy twins
Rhys Darby as Livingston Dell
Chang Hung as The Amazing Yen

Cool, so who would you cast for the NZ version of "The Big Short"?

Fantastic film by the way, based on the madness behind the GFC from the perspective of the US property/banks melt down.


Shamubeel Euquab as Christian Bale.. spruikers were laughing at him for suggesting the crash, and getting the timing off. But it's all about logic and fundamentals that a small country of 4M people can't sustain an average price of $1M per home. Once investor panic sets in, it's all over.

Yes that is a good movie and very timely for everyone to watch now.

Yes agreed, "The Big Short" is a film that everyone should watch at the moment along with "99 Homes". And we really need to listen to the people who have experienced this before.

I would cast Marc Cohodes for the Brad Pitt role, though Marc is a lot more vocal about what's currently happening with the Vancouver housing and rightly so.
He's an Ex-Wall Street trader who is speaking out about how the Vancouver property bubble is going to burst and how it got there, very similar Auckland's situation and relates to a lot of other cities around the world.

On the money article:

At least Vancouver has an business infrastructure where essentially what do we have here in Auckland for our economy; Property and a bit of tourism that's about it really.

I'd be very interested in hearing what Marc Cohodes view on the Auckland property market is, since we seem to be dropping in sales and value much more quickly than Vancouver at the moment.