Sales at Auckland's largest real estate agency rebounded strongly in May while prices remained more or less flat.
Barfoot & Thompson sold 1306 homes in May, up 38.3% compared to just 944 in sales April and 1225 in May last year.
It was the highest number of homes the agency has sold in the month of May for more than 10 years and Barfoot's busiest month since September last year.
The median selling price of homes sold by the agency was $809,500 which was down 1.3% from April's record median price of $820,000, but up 7.9% on the median price of $750,000 in May last year.
However the agency's average selling price hit a new all time high of $874,623 in May compared to $873,599 in April.
Overall the price trend appeared to be flat.
Barfoot & Thompson managing director Peter Thompson said prices in Auckland had lost their upward momentum.
"The average sales price in Auckland has remained static for two months now," he said.
The surge in sales volumes was helped by a rush of new listings as more people decided to put their properties up for sale.
Barfoot newly listed 1905 homes for sale in May, up 27.3% compared to the 1496 new listings in April and 1740 In May last year.
It was the highest number of new listings in the month of May for more than a decade.
However demand remains strong and the company's inventory (the total number of homes it has available for sale) improved only slightly, rising from 2846 in April to 3013 in May.
"Listings remain at historically low levels and there has never been a better time to sell," Thompson said.
"More than a third of all properties sold in May (464) sold for in excess of $1 million, with 14.2% (185) selling for less than $500,000.
"In the last two months, the number of sales has not influenced prices.
"In May turnover was high and in April turnover was low, yet for both months prices remained relatively static or fell," he said.
Barfoot & Thompson's Sales in May
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30 Comments
Personally I don't think anybody buying now is very smart.
Maybe hopeful, irresponsible, greedy, but not smart.
Prices don't need to fall (although they will). It's enough for prices to remain flat for many speculators to be in a seriously bad situation.
Almost there for the big "told ya!" :-)
I hope you are right but im thinking you are probably not. There is a massive bid waiting to get into the property market. Interest rates arent going much higher for the foreseeable. Add to that no real effort to get supply moving in a meaningful way or trim our migration number and you get a couple more years of growth. Dont get me wrong.. I am a first home buyer wanting to get in and will love a pull back
Migration is slowing and there are many global economic red flags on the horizon. I believe prices are going to drop next year. If there is a housing crisis and shortage of supply then why was the Auckland market pretty much dead between October 2015 and Jan 2016 besides the reserve bank measures and Chinese out flow restrictions? And why is there a surplus of rentals in Auckland?
The question is where do you put your money when you get out of the property market or downsize? The stockmarket, despite it more or less replicating the performance of the Auckland property market over the past few years, still has plenty of stocks yielding 5% or more. If you are feeling more defensive you stick the money into bonds or the bank but then you are looking at income levels at 3% or less.
I sense a growing trend of many retirees downsizing and then helping the younger generation get on the ladder.
Any laundry money tied up in property is already in and unaffected by stage 2 of the AML rules
Smart money. Anybody with a few smarts is already out. Fevered auctions have cooled markedly
Olly Newland has been bearish for 12 months now. If you went to one of his seminars now do you think he would be advocating pinning the ears back, loading up with debt and leaping in? I doubt it.
"The median selling price of homes sold by the agency was ... up 7.9% on the median price of $750,000 in May last year" Also according to your table the average selling price is up 6.4% on a year ago.
This is the real news: median price up 7.9% average price up 6.4% !!! NOT 20+% pa, THE MARKET IS DEFINITELY COOLING OFF
The market may be plateauing....but it is not going down. That will only happen with a significant price drop. And come summer all bets are off. Not to mention there is plenty of room for increases to continue in the regions. Hamitlion, Tga, and further afield still have good yields and prices well below Auckland.
This is not the end...not by a long way. Unfortunately.
I was going to stop myself posting here as inevitably the market takes off and no amount of common sense seems to stop it. Having gone to a couple of auctions and read a few things this week there is a shift in the mood. And it's getting more dangerous as each year ticks by.
1. Watched Olly Newland and fund manager call a bubble - http://www.nzherald.co.nz/economy/news/article.cfm?c_id=34&objectid=116…
2. Saw stats for fastest mortgage credit growth ever
3. Read that investors now taking 46% of Auckland mortgages
4. NZ Banks exposure to property is 50% of book
5. High prices on low volumes - a market peak signal? (see NBR comment - http://imgur.com/CTTI7Fy)
6. Auckland #1 in the price to income charts! Woo-hoo!
7. Round it off with your own number 7 - there are plenty to choose from. I would suggest "No the offshore Chinese buyers are NOT back, back, back!!!"
I've given up predicting anything but when Oz goes, NZ follows and their apartment prices are falling and the warning bells are coming from all sides. See today's top story: http://www.smh.com.au/business/property/oecd-warns-australian-property-…
Problems in Oz will expose the banks, they will improve lending standards and try to reduce exposure, including their NZ books and credit boom comes to an end. Interest rates go up as the cost of capital to these banks will go up (despite shot through economy).
That's not a prediction. But it's not an implausible scenario. It's becoming more likely as prices escalate.
Well said. No politician or real estate agent will ever admit that Auckland house prices are the result of irrational exuberance. It is difficult to predict when the crash will occur (I thought it was a certainty in 2008) but the result will be many people with negative equity. And unlike many states in the US, it will not be possible to simply mail the keys to the bank and walk away.
Everyone knows the truth about overseas buyers but our government. Actually they too know but have reason of their own for the bubble to continue as fir them is a sign of prosperty though sre hsrming NZ badly in the long run. Real estate sgents openly sats that we need one chinese interedted to sell the property and if have two or three than better as will thsn break previous records.
I will just play devils advocate for a moment and put together a reason why the property market is where it is.
Imagine you are Mr Billionaire who just wants to preserve his wealth over the next 50 years.
Let's look where he might put his money.
In 1/3rd of the world he gets a negative return on bonds.
In NZ he can lock into a 2.25% pa return on the 10 year government bond
In the US he can get a yield of 1.81% on the 10 year treasuries.
In Auckland residential market you can get a yield of around 3-3.5%- although need to factor depreciation.
On the NZX50 the average yield is 4.5%.
At the end of the day none of the above are particularly exciting returns but it makes it easier to understand why the wealthy investors are still putting money into the property market at the expense of individuals who simply can't afford to. It all a consequence of QE and not necessarily just a NZ problem. I therefore think the only way to reduce prices to make housing affordable to FHB's is to tax investors.
Also in Auckland investors know that there will be much greater housing density in the coming years and that is why land banking is happening.
No doubt Mr Billionaire will have his money split across all asset classes.
Between february and now the house prices are up by average 10% for sure so I do not underdtand what the current data is about or is it just to prevent govt n RBNZ not to impose any new rules which is not in their interest though if the govt n RBNZ does sonething will benefit New Zealanders.
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