Auckland's largest real estate agency sold exactly a third of the properties at its latest residential property auctions.
Barfoot & Thompson had 136 properties scheduled for auction last week and sold 45 of them, giving an overall sales clearance rate of 33%.
The remaining 91 were mostly passed in for sale by negotiation and a handful had their auctions postponed or cancelled.
The highest success rate was at the North Shore auctions which achieved an overall sales clearance rate of 44%, followed by the auctions conducted on site which had a sales rate of 43%.
The lowest sales rate was at the Pukekohe auction where none was sold, although only three were offered, followed by the Shortland Street auction on May 24, where most of the properties were from central fringe suburbs such as Onehunga, Mangere Bridge and Avondale and the sales rate was 18% (see chart below).
The most and least expensive sales for the week both occurred at the North Shore auctions, where a two bedroom terrace house in Browns Bay sold for $500,000 and a modern, four bedroom/three bathroom house on a 1618 square metre section at Greenhithe sold for $2.88 million.
Individual results, with details of the properties offered and the selling prices of those that sold, are available on our Residential Auction Results page.
Details of commercial property sales are available on our Commercial Property Sales page.
| Date of auction | Auction location | Sold | Not sold | Total | % Sold |
| 21-27 May | On site | 3 | 4 | 7 | 43% |
| 22 May | Manukau | 11 | 17 | 28 | 39% |
| 22 May | Shortland St, CBD. | 3 | 8 | 11 | 27% |
| 23 May | Shortland St, CBD. | 10 | 25 | 35 | 29% |
| 23 May | Pukekohe | 0 | 3 | 3 | 0 |
| 24 May | Kerikeri | 1 | 2 | 3 | 33% |
| 24 May | North Shore | 12 | 15 | 27 | 44% |
| 24 May | Shortland St, CBD. | 2 | 9 | 11 | 18% |
| 25 May | Shortland St, CBD. | 3 | 8 | 11 | 27% |
| 21-27 May | All locations | 45 | 91 | 136 | 33% |
92 Comments
Twenty-seven to twenty-nine percent. That’s pretty grim isn’t it! I reckon a lot of the analysis that Martin North is giving on the Sydney housing market is directly applicable to the Auckland market. Specifically that the top 10th percentile (most expensive) is declining the most rapidly see here. North doesn’t say it, but we all know why that’s happening. I also think the next RBNZ C5 aggregate housing lending data point will show growth that’s well below the 12 month lagged trendline. Find out if I’m right on Thursday.
Zach will be on this morning to crunch the numbers and I’m sure the average sales price will be around 2017 cv. It’s a shame that highest bids on properties that didn’t sell aren’t published, could punch those in too and see how the averages stack up on a much larger portion of the properties.
I did crunch some numbers last week based on B&T sales. Generally close to CV. Just remember that the CV was June last year. So a sale at CV is a decline from the increases in late last year - and the CV excludes chattels (1-2% of sale price). Therefore, sales around the CV are probably a minor drop over recent months.
You do know the CV is just a made up number that allows the govt to tax you more and the banks to justify getting you into even more debt. Yes kiwis have been suckered into believing that it is a guideline for prices but not in a crash. 2012 CV will probably be a good guideline for this time next year. Good luck.
Double-GZ. Like I said, a made up number to tax you more or to get you into more debt. It's going to be interesting to see what the herd does when the penny drops with the reality of 'Oh sh*t, It's actually worth $700,000 not $1,000,000' But sheep are pretty dumb animals so it may still take a bit of time. Auction results like this will give a few of them just a small indicator as the stock of unsold houses keeps rising through the winter.
Hi Nic,
Owning a house is not just about finance and debt!
There are heaps of other things to home ownership - including a wide range of tangible and intangible benefits.
But if one happens to increase their $$$ net worth through ownership then that's fine as well. Few home owners ever seem to complain about it.
TTP
Double GZ there are a lot of what you call 'stooopid' people who hang their hat on the CV. Valuers don't do the actual buying.. nor are they the ones lending the money to the people who do.
One house for sale and five willing and able buyers is a very different dynamic to 20 houses for sale and 1 willing and able buyer. Guess which direction we're heading? I'll give you 2 guesses just in case you're, how did you spell it?
The top end always fluctuates the most. Rises the most due to rareity in boom times and drops the most due to all but a few having the ability to pay and shutting their wallet.
When the top end is removed by the upcoming ban it will be interesting to see if 7m is really 3-4m or not. Still miles out of reach for most but a big difference.
What ban? Aussie, Singapore excluded. China has the most preferred trading nation status with us so if can't get out of excluding Singapore than we can't exclude China. Just been talking to a lawyer expert on this today. Why do you think this has been delayed so many times. The CoL didn't understand the full legal implications of this and our trade agreements. What's the point in doing this if can't be enforced on China. Even I'm pissed off now as I expected them to at least get this ban in.
We can just add to the broken promises list. The list is getting sooooo long, we might need to form a "working group" to manage it.
Any analysis of the few that did sell is obviously going to be skewed. That sound you hear in your ears is just tinnitus.
https://www.youtube.com/watch?v=Tekhh7Iy-sM
Looks like the 'International market for highly leveraged, poorly insulated sheds in Auckland, is collapsing! Given the foreign buyer ban on the horizon is there any way we could pick them all up and see if we could export them instead. At least that way we have a chance of getting some money back on them. Would India or China buy them?
I have, and they are complete rubbish.
https://www.youtube.com/watch?v=ENLIGHXbGfE
At least B&T are being upfront releasing these figures.
Imagine a RE trying to talk a vendor going down the more expensive (e.g. higher advertising costs) auction pathway knowing that auctions currently only have a 30% success rate.
The low success rate also suggests both vendors' expectations are still too high (despite further negotiation once reserve not met) and there could be some urgency/desperation on vendors part to foot the additional cost.
Also very demoralising for unsuccessful vendors.
Look, the agents don't mind the house not selling at auction at all.
It is a HUGE message to the vendor i.e. you are asking too much!
The agents have scripted dialogs like "We have brought you the market and the interest is at a lower level than the reserve..."
And so on.
The auction day is in some ways only the beginning of the sales process for the agents.
Still dismal clearance rates
Forget about how close to CV the ones that sold went for, it means nothing. The true story is that the 91 people who couldn't sell their house couldn't get 1 bid to meet reserve!!!! or negotiate an offer after passing it in!!!!
Those 91 will have to re-evaluate their expectations and Im betting they will have to be well below CV
The sales price averages on the properties that did sell at auction @ 33% clearance rates is no clear indicator of market health. That would be like me spending a week at Manheim auctions, seeing a bunch of vintage cars in mint condition sell for above their appraised value and deciding that my 82 Corolla with 4 wheels and a rusted bonnet might sell for above my insurance company's "agreed value".
Yawn, these are so predictable. Confirmation bias is rife. Auctions are a part of the market, not the whole part. It's like some of you are gazing in the Market's ear to diagnose an ingrown toenail.
As I posted last week. There were 190 sales in 1071 for the four months to 30/4/18 which were worth $331 million representing 99% of the total CV of $335 million.
No, 1071 isn't the whole market. It's just the part I take interest in because I live there. I have no immediate intentions of buying or selling. The info came from a monthly RE email. Surely there are others out there for other regions that people can post? It would be more informative than this monthly auction thread as it covers sales by all marketing methods.
Properties are selling les 15% to 30% less than RV that is norm now with some exception that may sell near around RV but at the same time hacevexception and have seen some are selli g less 50% of RV.
Any one in market to buy should see when was the last time that property was sold and if if it is on or after 2015 chances will not be sold as the vendor will not get the sell price and sold sign is possible if he is able to take a hit. Again may have some exception and even in that scenarion will be able to break even after agents commission.
One thing is for sure all gain in property in Auckland from 2015 has gone and where it will stop only time will tell but defenitaly anf FHB or even investor should wait n watch instead rushing.
According Financial Times' Research, 56.8% of Chinese outbound investors plan to invest more abroad in the coming two years.
Read more: https://buff.ly/2rMEALI
Introducing DGZ, another devout worshiper of Juwai.com. I think you're just clutching at straws now. A symptom of pending losses. Heres just one of their predictions; https://list.juwai.com/news/2017/11/how-will-chinese-buyers-react-to-nz…
IT NEVER HAPPENED!
"56.8% of Chinese outbound investors plan to invest more abroad in the coming two years".
Wonder how many will end up in Sydney and Melbourne instead of Auckland. Education is one of their main points of investing overseas now that a number of Australia's universities made the top 100 in the world, namely Melbourne Uni, Uni of Sydney, ANU and Uni of Queensland.
Of course they would rather invest in Australian cities they are better in every way. It is just much harder for them to do so.
And ex expat, I find it incredible that you would crow about your postcode yet you have sent your kids to Selwyn of all establishments. Truly bizarre.
I've explained this before. A few years back, we supported the group getting rid of Carol White and her rag tag bunch of lefties on the Selwyn school board. Having done that and seen the results, we gave one child the option of Selwyn or his choice of private schools (day boy not boarding). He chose Selwyn due to the cohort going there from his primary/intermediate school, its proximity and its multicultural aspect. He has Pakeha, Chinese and Indian friends, one of the latter is his girlfriend (must check to make sure she's a Gudjerati!). He also achieves at that school. They must be doing something right as he just got his first after school job based on his presentation. Given we have tested all flavours of education, including one of NZ's top private schools we are well placed to sort fact from fiction. For us it's not the school per se, it's the child and their environment. We're actively encouraging our children to be expats for at least part of their lives. Where they schooled is irrelevant in that case, it's what they have achieved to date and their ability to work in the modern world. If you have a confident handshake, look people in the eye when talking to them and address them by a respectful title you are likely in the top 10% of job hunters. We don't abide swearing in the house either. A positively archaic view but it seems to work in producing kids that the working world wants.
I'm sure you meant 'sought' :)
BTW: I don't think Selwyn is perfect (It did allow Taxinda to visit, which I made sure my son knew I disapproved of), but as long as it represents its catchment then I'm happy. Ms White seemed to represent the type of leftie I dislike the most, the nanny state that knows what's best. She was oblivious to a declining roll and was bussing students in to keep the doors open. She dismissed our group as arrogant wealthy types that would never send their kids to a State school. Well she was wrong, as are most lefties (I can't be absolute as I haven't met every leftie out there or under my bed).
Cracks me up when adults call people names like lefties. I'm happy with what ever and whom ever people vote for, all people have different reasons and different upbringings that give them their core values. Unless they are weirdos like Trump and Putin and have psychopathic tendencies.
I come from a farming/steel background and lived in various areas, then was educated at uni, work in corporate and now trying to start up a number of businesses.
I do have left tendencies as I like helping people out, but I am a little selfish as well, so a bit of a capitalist pig. All I want is a balance, which NZ did have in the past. I read an article on Jim Bolger and he is a man after my own heart. I think a lot of National members have social tendencies, and a lot of labour are capitalists. I just think to get things moving in a direction you have to over steer and when you over steer, the country seems to get in a mess, then to fix it you need a new government to oversteer again to correct the mess.
I do wish we could reduce corporate tax, and gst, I do think these types of taxes hinder business. I was looking at importing products from overseas, and the gst tax makes it prohibitive. Anyway, call people lefties if you feel like it, as it can be a badge of honour, but I find it unusual that intelligent people do this when the only crime someone has committed is by having a different point of view.
Not many houses sell with tenants in them which is interesting when you think about it. You would think that would be a really good incentive. Actually I have noticed that houses that are leased to HNZ sell for lower than they normally would.
I usually wait for a tenant to leave of their own accord before putting a house on the market. There are two reasons for this. The first is I don't want to disrupt a tenants life for my own personal gain, the second is, I want to tidy it up and stage it for maximum sales appeal.
I didn't bother reading your essay but I will state in simple terms why you sent your kids to Selwyn and then try with great effort to defend it. Quite simply for whatever reason they can not perform at an elite school. This is how it will always appear to most, a massive red flag for any future employer.
But you keep telling yourself that its better than all the top schools now well done.
I think that's very sad, putting down someone's school. Its also very class orientated, which I particularly dislike, very English like, not NZ like at all. If an employer looks down their nose at someone that goes to a particular school says more about the employer then the student.
I personally think people should start up their own businesses, my son is six years old and we are looking at starting up something on you tube. Nothing may come of it, but over the weekend, we were looking at putting call to action buttons on the video, how to build a community, and writing blogs and setting up a website. He's so excited by this.
He's only 6 and he narrates as well, plus I point him in the direction on what to look for. Nothing may come of this, but he will learn so many skills. I think schools only teach people how to regurgitate. Something like what we are doing will teach him life long skills. We were also talking about him interviewing people.
I'm hoping my son bypasses people like you Tui12 who make judgements on people and their schools.
Barfoot & Thompson make vendors believe that an auction will enable the vendor to get there price. The reality ... Barfoot & Thompson use Auctions to sell quickly. They get there commission and the vendor makes a significant loss. If you are selling stick to your sell price. Supply is still not meeting demand. The government are spreading new housing development (housing corp) throughout Auckland, which includes Epsom. The cost of land still increases in Auckland.
MiniCat, I actually agree with you. I have experienced this myself. It is more hassle to sell by negotiation and there is more risk of a bit of an upset along the way but if you have a good product and you stick to your guns you will invariably make more. A few weeks of hassle and hard negotiating are probably worth 50-100k.
Sticking to your guns is essential. When that low ball offer comes in don't negotiate, suggest they should look for a house in Manurewa or Pokeno, somewhere in their price range. Two can play hardball. They made an offer, if they really want your house they will come to the party.
I am not going to do my usual analysis this week however I feel the need for a little fireside chat about understanding the value of your home.
Now for the purposes of this exercise imagine that your home has remained unchanged since the time you bought it in 2007. No major improvements or additions. You have done maintenance and painted it and kept it tidy though. You come to sell it in 2018, what do you do? Use the current RV? You may be lucky but generally not. Most buyers know the current value of a home. Most sellers over value their homes for emotional reasons.
The calculation is really very, very easy. If you bought your home in 2007 for 500k it will now sell for about 970k. This is because houses in Auckland have gone up 94% in that time period. Nothing harder than that.
Sure some suburbs may have gentrified a bit but actually in the last twenty years all houses in Auckland have gone up about the same percentage. There will be the odd exception due to someone having too much money or a buyer who really needs your house but this is exceptional.
Assuming you bought the house for the correct price in the first place, simply calculate the value of your house using this system and stick to that price as the bottom line no matter what.
As they say "not rocket science"!
We don't even need the inestimable assistance of Moorish "mathematics" to do this calculation.
No better way to start a Wednesday with ZS BS.
It is a well noted phenomenon that house owners are actually very bad at predicting the true market value of their properties.
Generally they always overestimate the value increase in an appreciating market, and underestimate the value loss in a falling market. And not by trivial margins.
Also, it is stupid to assume that all property in Auckland has gone up 94%. Because, it isn't true. It may be a viable concept in the land where you take 30 properties for a SPAR analysis and assume that sample converges to the true Auckland distribution of property. But this is a schoolboy exception.
Mangere property, for instance, has appreciated substantially more in relative terms than the average Auckland property. Titirangi on the other hand has appreciated at a relatively lower rate.
My advice:
Stop trying to sound so smart with your constant follies into mythology and history.
Use google instead to gain some basic mathematic and statistical knowledge.
Thanks nymad. Fireside chat may be a euphemism for BS.
Of course I paint with a broad brush here and it would be wise to narrow the calculation down to 'similar houses in close proximity' for a more accurate calculation.
I can't take your final advice as myths and history lessons are my 'shtick'. All commenters have a 'personality' and this is mine.
Was this past week an outlier per chance?
As to holding to a price no matter what, this is in conflict with your expressed idea that buyers have a better knowledge of the current value. If the buyers don't arrive after a period of time on the market, then the "no matter what" results in a house that doesn't sell, for a very long time.
There is one house that was on the market when I first arrived in Hawkes Bay almost a decade ago. It had been continuously on the market ever since. It finally sold last year for 10% above the asking price (and 10% below the RV). That emphasis on "no matter what" cost the vendor a HUGE amount of money. The house would have sold in an instant in the Auckland market but was ostentatiously out of place in this market.
DGZ, by chance are you camped out at Auckland Airport arrival gate ready to greet the tidal wave of cashed up Chinese? If you're needing to seek approval from Zachary, its more than likely you're compensating for unpalatable truth. Our house has gone up %%% too! Wipededoo
Another anecdote regarding the idea of holding to a price. First, I will note that this method works nicely in an inflating market as eventually the price rises to meet the inflated expectation. In a flat market, the home just sits unsold, with no major losses to the vendor other than carrying costs. In a declining market, things get very messy. I watched a few neighbors get trapped in this manner back in 2006 as the market went from white hot, to soft, to declining in the period of about nine months. My neighbor across the street put her house on the market at just above what I thought was a good value. Six months later it was still unsold and she had dropped her price by about 5% to chase the market. That price would very likely have resulted in a sale if it was the ask 6 months earlier. We put our equivalent house on the market, maybe 5% lower than her current ask. We had multiple offers on our house and got a good price with only two weeks on the market. Six months after this, she settled for 15% under her first target price as she continued to drop her ask slower than the rate of decline.
Yankiwi, I broadly agree. The examples you give are for people not quite doing the calculation properly.
Perhaps I should modify my rule to calculate the figures then knock a further 5% off for a sure sale in a flat or mildly declining market.
My 'hold and make them bleed' advice would be for hot property locations.
Yeah, this is exactly the situation we are in now with a house we are selling in the UK. The market has begun to cool. Agents are valuing the house at the hot market price, but we have put it on at 5% below the valuations. We'd rather lose a small amount now than get less later and having suffered the opportunity cost of doing something else with the money waiting for it to sell.
There are a lot of theories about house prices.
The most compelling are what goes up must come down and some people swim in tidal estuaries without underwear. We can thank the Moors for these insights. And let us not forget about a historical character called Norm, possibly derived from Norman the Conqueror, from postcode 1066, a Christ-like personality who some people fear and some people pray will return... the terrifying 'hysterical Norm'.
When people go up they must come down and if they are not wearing underwear what an awful sight it is. Don't look up is my advice and just keep watering the tulips.
But then we have Voyager. If enough thrust is given to the Auckland market it could break away from Earth's orbit and enter into deep space, captained by the Greatest Fool, copiloted by Wookie the 'Animal Spirit' fueled by the mystical irrational exuberance, beyond the reach of any SAM or FHB or the evil black swans.
And global warming will ensure the tide will come in even further providing reassurance to those that like to skinny-dip.
Strange times. I write this comment as an homage to Alter Ego.
I've done a very quick analysis of the sales and non-sales data (a quiet morning in the office):
Sales totals were around 1% over 2017 CV.
Out of the 91 that didn't sell I've found at least 29 of them were purchased by the Vendor within the last 4 years. Maybe I'm reading into it, but I wonder what their motives for selling were.
I will happily put down a school that is in an area for rich kids who have the privilege to go to an elite or private school but for obvious reasons choose the mediocre option. Selwyn has, is and will always be a school for misfits. Very different if you live in another area and go to the best school in that area i.e .McCleans, Takapuna or Mt Roskil Grammar for example which are great. I will make no apologies for that.
Why do they have the privileged to go to a school that charges a fortune. Not everyone does at places like Selwyn.
This conversation is pointless. I'm just glad I'm me and you are you. Things like this do not even come onto my radar as an issue.
I have been to many loving families in this world, money, privilege and great schools, do not necessarily make a happy person.
As long as my kids try their best, are polite to people, treat everyone with respect then I'm happy, everything else is a bonus.
Swapacrate, we agree on something. I thought Tui12 was going to name an elite school. I’m only vaguely aware of the ones he/she mentioned. For the record, there were only two choices given 1. Follow the older sibling to Kings or 2. Go local to Selwyn (out of zone by the way). He chose Selwyn. I’m proud of him. He’s the future. Tui12 and his/her type are dinosaurs. Adapt or die. I’m preparing my children to compete with yours. Doing a good job so far.
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