Harcourts had a good start to the year with sales up 8% compared to a year ago but selling prices were softer, particularly in Auckland

The country's largest real estate agency started the year with an 8% lift in sales compared to a year ago, although prices eased back from where they finished up at the end of last year, especially in Auckland.

Harcourts sold 1433 residential properties throughout the country in January, up 8% compared to January last year.

The average selling price was $554,021, up 6% compared to January last year but down 10.4% compared to December's average price of $618,459.

The increase in sales compared to a year ago was highest in the Central North Island (+16.7%) which includes the Waikato and Bay of Plenty markets, followed by Christchurch +15%, Wellington +12.1% and Auckland +8.4%.

The only area to record a decline in sales was the South Island (excluding Christchurch) were sales were down 5.2% compared to a year earlier.

Prices were softest in Auckland, where the January average was $935,773, down $71,607 (-7.1%) compared to to the December average of $1,007,380 and down 0.6% compared to January last year.

In the Central North Island (including Bay of Plenty and Waikato) the average price in January was down 9.2% compared to December but up 7% compared to January last year, in Wellington the average price was down 7.8% compared to December but up 7% compared to January last year, and in Christchurch the average price was down 4.2% compared to December but up 9% compared to January last year.

Inventory levels, the total number of properties an agency has for available sale, were up 3,3% overall compared to a year ago, but that was concentrated in the North Island, with inventory levels in Auckland up 9.9% and up 12.1% in Wellington while inventory levels were down in the South Island.

Harcourts chief executive Chris Kennedy said the 8% lift in sales compared to a year ago was an encouraging start to the year.

"I think that's a sign everybody is starting the year feeling pretty confident about where things are going," he said.

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27 Comments

Don't expect further house increases....headwinds on the way.

We are seeing a lot more Foreign Interest in the Open Homes we have been attending the last few weeks. This could be part of it? https://list.juwai.com/press/2018/01/realtors-report-spike-of-interest-a...

I understand you want to get it right – but this delay and level of forewarning would appear to be somewhat self-defeating – in the short term anyway.

too late that door is being slammed shut
http://www.legislation.govt.nz/bill/government/2017/0005/latest/DLM75129...

16A Commitment to New Zealand test

(1)
In relation to an overseas investment in sensitive land,—
(a)
if the relevant land is or includes residential land, subsection (3) applies:
(b)
otherwise, subsection (2) applies.

(2)
If this subsection applies, the commitment to New Zealand test is met if the relevant overseas person is (or, if that person is not an individual, each individual with control of the relevant overseas person is)—
a)
a New Zealand citizen; or
(b)
ordinarily resident in New Zealand; or
(c)
intending to reside in New Zealand indefinitely.

(3)
If this subsection applies, the commitment to New Zealand test is met if—
(a)
the relevant overseas person is (or, if that person is not an individual, each relevant individual with control is)—
(i)
a New Zealand citizen; or
(ii)
ordinarily resident in New Zealand; or
(iii)
the holder of a residence class visa (within the meaning of the Immigration Act 2009) specified in regulations, or a person with a nationality status specified in regulations, who meets the requirements for showing commitment to reside in New Zealand that are set out in regulations for that visa class or type or specified nationality status (a qualifying individual)

While Harcourts sales figures appear encouraging, I think the market is now just biding time in a "toppy" state. Its ripe for a massive correction helped along by an unexpected event of which we have recently seen a few tremors.

Forget about foreign buyers jumping in on mass ahead of the ban. Sounds more like spruiker propaganda than anything.

I find it hard to imagine why foreign investors would risk catching a falling knife unless they are moving here permanently anyway.

Investment assets are viewed more like a juggler walking up the stairs. If the stair case is long enough investors often dont care about where the balls are... unless the juggler drops them, which is possible.

That’s the thing about a massive erection Poppy, once the nasty deed has been done it all becomes just a bit limp.

Apologies. Its just whenever I see ‘massive’ followed by a word such as ‘correction’ I get overcome

Badlad ;-), would you prefer I used the words "Cataclysmic freefall"

Now that’s just asking for trouble

Yes, "toppy" state can be quite difficult to maintain - tricky market dynamics - a never ending herd of new punters and $$'s required.
Thus the word "ponzi" thrown around.

Hi Stealth,

Have a look at what RBNZ's Survey of Expectations has to say about house prices.........

I think you're mistaken.

TTP

TTP, the RBNZ economic forecast has been labelled "excessively optimistic" and for good reason.

https://www.interest.co.nz/news/92039/westpac%E2%80%99s-chief-economist-...

Before you run out and tell everyone to buy rentals in Waitakere, it's worth noting that it's not the RBNZ job to protect you from losses;

https://www.stuff.co.nz/business/99408539/reserve-bank-warns-its-not-our...

REINZ regional for January out in next day or two?

Have Harcourts always used that style of graph e.g. corner view 3d perspective? Terrible way to present data, at least the numbers are there.

Tilted graph makes the $935k look higher than the $941k.

I can think of a few individuals who might fall for that trickery.

Looks like it's slippery at major centres- losing traction fast. Must be the weather.

Appears Christchurch prices are holding up rather well despite the gloom about ChCh being painted by Gordon.
Things are really starting to happen in Chch and all for the good and it will being the city of choice for the young in the years to come!
House prices average will increase once the as is where is where is properties gradually decline in no.s being sold

I don’t think it matters that much if prices are softening in certain cities or regions – in a general sense it’s not some sudden refection or revaluation of their desirability or otherwise.
In the last 12 months they are basically the same places – with the same good and not so good.
Prices simply got out of kilter – especially for average Joe Blow – a pricing adjustment is subsequently taking place – that’s all.

Custard, it is only Auckland and places nearby that are probably unaffordable for first home buyers.
Other parts of NZ are still very affordable and as such this is what should be getting reported!
Auckland is not NZ although by the talk from most on here, you would think it was!

Custard, it is only Auckland and places nearby that are probably unaffordable for first home buyers.
Other parts of NZ are still very affordable and as such this is what should be getting reported!
Auckland is not NZ although by the talk from most on here, you would think it was!

There are obviously a few reasons why Auckland has the huge population it has otherwise people would vote with their feet. Interesting that Christchurch is the size it is and there is no pressure on house prices and rents are dropping. The word “opportunities” comes to mind.

I really do take your point on this TM2 – but in my mind clearly something isn’t quite right.
Without going mad on research - it would seem a lot of people NZ wide are either on or close to minimum wage rates – and I would think quite a few others aren’t that much above it.
I don’t know what it is – perhaps the prohibitive deposit required – while landlords may enjoy rising rentals, this is probably hampering some in saving for a meaningful deposit.
And while we can all bang on about financial discipline, commitment, financial plans etc from prospective home wannabees – some just can’t and will never do it.
So they may never buy, and if home building ramps up, prices may thus fall or instead be purchased as rentals – but will need to be purchased at a price justifying yield – rather than capital gain.
Or I could just be completely wrong.

Hence the word "correction"

This is further evidence of a stalled Auckland market with prices regressing but not yet in freefall, might not be too far off though.

I note that Trade me iverntories are over 11700 and realnz over 12900 and rising...

Fact Check - all external factors we have had for last 4 years - gone. Chinese cash - gone. Investors ability to raise cash- gone. Investors expectations of price increases - gone. Slowly growing concerns of interest rate rises- here and now. Concerns of Labour Tenant friendly legislation - a real concern.
Sales numbers per month have been declining since July 2016, to levels now of 2013, 2014, ie normal for our Nz buyers market.
Vendors need to adjust to a " normal " selling market - ie lead the market down to get attention and sell - not follow....

ANZ releasing NZ$800 odd million back to investors in April! Bet I know where that money will end up...