The housing market is feeling the winter blues, with average asking prices of homes newly advertised for sale on Realesate.co.nz falling in a majority of districts in June.
The national average asking price dropped from $642,478 in May to $626,889 in June, with declines recorded in 10 regions (Northland, Auckland, Manawatu/Whanganui, Wellington, Nelson, Marlborough, West Coast, Canterbury, Otago and Central Otago/Lakes) and rises recorded in nine (Waikato, Coromandel, Bay of Plenty, Gisborne, Hawkes Bay, Taranaki, Central North Island, Wairarapa and Southland).
In Auckland the average asking price dropped from $956,267 in May to $905,013 in June, which was the fourth straight month in which it has declined since it peaked at $978,652 in February, a drop of $73,639 in four months.
In Wellington it dropped from $568,493 in May to $541,298 in June and in Canterbury it declined from $492,551 in May to $461,351 in June (An earlier version of this story contained a map which showed the monthly movement in asking prices around the country, which did not match the average prices stated in the story. That was because the figures in the map were seasonally adjusted, while the figures in the story were not seaosnally adjusted).
The was also a decline in the number of properties newly listed for sale on Realesate.co.nz in June, with the national total dropping from 9860 in May to 9026 In June, which was also below the 9327 that were newly listed in June last year.
Of the 19 districts around the country, 14 recorded a decline in the number of new listings and five (Hawkes Bay, Coromandel, Central North Island, West Coast and Central Otago-Lakes) recorded a rise, although the listing numbers for the regions that recorded rises were small.
That saw the total number of homes available for sale on the website drop from 24,229 in May to 23,507 in June, but that was still well up on the 21,612 that were available for sale in June last year.
In Auckland the total stock of homes for sale dropped only slightly, from 8622 in May to 8560 in June, but that still was up a whopping 57% compared to the 5463 properties that were available for sale in Auckland in June last year.
In Wellington the total stock of properties advertised for sale on the website dropped from 1069 in May to 944 in June, but that was still up from the 830 available for sale in June last year.
95 Comments
4.39%. An historically good mortgage rate. But just imagine how much less the servicing costs would be at that rate if the debt underlying it was half of what you ( 2nd person plural!) have today. And what else you could do to stimulate the wider New Zealand economy if you ( again!) had half of your capital cost outlay still in your bank account and the weekly outgoings gave you more disposable income to spend? High property costs will eventually kill any economy if they are not underpinned by productivity increases (ie: as a country, we don't have to borrow to live), and we are/will be no different.
MisterB, if you look at Zombie Ponzie's RBNZ link above you will see that the changes have been insignificant from 2015 to 2017. Most people that refixed this year have done so at reduced interest rates.
I would suggest that it is the banks themselves that have tightened up lending criteria which has resulted in fewer sales able to be arranged and consequently a mini correction in certain areas.
Really Zachary/DGZ what makes you think that the crisis is over and that normality will return to the Auckland market?? We've just dropped -$50k in one month!
Quote from article: "Auckland the average asking price dropped from $956,267 in May to $905,013 in June"!
The fact that it's been dropping for four straight months and it still has much much further to fall until it reaches affordable levels for your average Aucklander. You're so not out of the woods yet.
That's right. Listing in Auckland 57% higher year on year in winter!
Come spring when the new listings show up... its going to be very interesting!
Bachman–Turner Overdrive anyone?
You ain't seen nothin' yet
B-b-b-baby, you just ain't seen n-n-nothin' yet
Here's something that you never gonna forget
B-b-b-baby, you just ain't seen n-n-nothin' yet
Well I hope so. I just had a look this morning on homes.co.nz but July values are yet to be published...should be in the next few days I think. The value of my home is still the highest it has been since homes.co.nz first started. Will see if the Council follow it ;-)
very interesting - with an election in the offing - we could easily see this -4.7% repeated in july, august and September and we would finally have BH's 20% correction ! pretty much wiping out the majority of FHB's equity from the last 18 months - although investors will still have a decent margin
careful what you wish for as tehy say
Coming here?
from July 1...Property sellers face new 12.5 per cent tax ....So long as the purchase price is $750,000 or more, it does not matter whether it is sold by an Australian or foreign resident...
http://www.afr.com/personal-finance/property-sellers-face-new-125-per-c…
Incorrect - Read the article more closely
Australian residents selling property will from July 1 need to provide a "clearance certificate" issued by the Australian Taxation Office to the purchaser on settlement of the sale to avoid the 12.5 per cent withholding tax.
Foreign resident sellers will have 12.5 per cent withheld and remitted to tax authorities
... so true ... I toss and turn in my Gummy hammock at night , worried endlessly about the poor real estate agents of New Zealand ... how will they cope when the house price downturn kicks in in full force ... oh dearie me , how will they cope ...
Perhaps we could set up a crowd-funding site ... to provide monies to financially stressed RE agents ... how will we ever respect them , if they have to trade down from their Aston Martins or Porsches ... sigh ...
... the real estate industry is not a million miles from " multi - level marketing " .. is it ...
Where the first ones in make out like bandits , hoovering up the lion's share of the profits ... and the late arrivals get a progressively smaller slice of the action ...
... and the last ones into the scheme get taken to the cleaners ...
Not so different from " Ponzi " either , is it !
Today's headline is hardly remarkable...... It's mid-winter, with an election looming. Plus, it's post-boom.
The Auckland market is noticeably variable - with some localities still inching up in price. These include Grammar Zone and the Ponsonby area - where there are very few properties on the market.
You know Spring is only round the corner, I'll be really interested to see what excuses you'll come up with then for falling property prices.
Oh and by the way, if you take a look at the latest auction results for Ponsonby and Remuera. You'll find far more NOT SOLD than the one of two sold signs. So it's a little bit more than just a Winter chill.
Your top end overseas investors are gone and there is nothing you can do about it, and we all know it.
Better Dwelling article: China’s Massive International Real Estate Buying Spree Is Officially Dead
https://betterdwelling.com/page/4/
Hi CJ099,
You write: "You know Spring is only round the corner, I'll be really interested to see what excuses you'll come up with then for falling property prices."
Please note that I don't ever offer "excuses". I focus on monitoring and interpreting what actually happens.
I work across a number of investment and consumption markets - not just housing.
By the way, you'll find that nearly all the unsold properties in Ponsonby have been on the market a very long time. They're not desirable properties and it's no surprise that they haven't sold. Good quality, new listings in such areas are relatively few, compared with Auckland as a whole.
Realestate.co.nz currently lists just 3 houses for sale in Ponsonby. (Yes - only three!) Go into the site and check it for yourself. This is a historical low. The likely reason is that the long term potential of property in that locality is particularly strong and people won't sell.
Hi tothepoint,
Really, I find that extremely hard to believe and you can't be doing all that well since you say you can't even afford a home. So I think virtually all of us will take your advice with a big pinch of salt and promptly ignore it.
I still think you're an RE just trying to push us to buy property in a clear falling market, I'm sure that none of us local Investors would be silly enough to buy in this current market. I'll stick to the facts if you don't mind.
Hi CJ099,
You write, "I still think you're an RE....."
Wrong again. I have absolutely no involvement with the real estate sales industry. Certainly, I have never worked as a real estate agent. Neither do I have any friends or relatives who work in that industry.
My background is in research/analysis and policy. (Marketing/sales is not an area where I have any career experience.)
Finally, I have never stated that I can't afford a home. That's complete rubbish. I happen to own my own home.
@tothepoint: Actually you did state at least once that you couldn't afford a home. I know because I pulled you up on this topic quite recently before and directly asked you; why you were so keen to push the property market if you were trying to afford a home? And you didn't respond to me, you just prattled on as usual pushing the property ponzi scheme like an RE.
And as for being a research/analysis as you claim, you are pretty terrible if you can't even analyses the figures presented very clearly in the article. Plus again where are your figures or even any evidence to support your claims that this is just a blip and the market will return to normal?
So, NO I simply don't believe a word you say!
Interesting how tothepoint has consistently mentioned he's a renter and cannot afford Auckland property, and now suddenly he apparently owns property, on the same week we find out that DoubleGZ apparently has a big housing portfolio? What a convenient coincidence this sudden change of events.
Having a hard time keeping up with the lies there DoubleGZach/tothepoint?
Oh no you got it so wrong, I am not tothepoint I have no knowledge nor interest of the Ponsonby market to be honest. Also my portfolio isn't that big really but I have rentals in the south, west and central east (the Bays), although the West Harbour property is no longer a rental as family is living in it. I am now looking to get into the Puhoi/Warkworth area but I'm still doing my research. Also the fact that I only received $10k tax return from the IRD suggests that my portfolio isn't that big.
Hi tothepoint,
Really, are you sure? Because here's one of your comments that clearly states that you haven't entered the property market yet and therefore strongly indicates that do not own a home.
So I can only conclude that you are indeed lying, as other Commenters have point out as well!
To quote your comment: " If house prices in Auckland were to drop markedly, then people like me might be able to enter the market and purchase - but that's wishful thinking.......".
By the way if you change your comment the date stamp will also change and we'll know. The full comment is below:-
by tothepoint | Wed, 28/06/2017 - 17:22
With all due respect, gingerninja, markets are fickle......
Only yesterday, NZ won the America's Cup. That might well give a boost to housing activity (and prices) in Auckland - and elsewhere.
Prices remain pretty stable across most of Auckland. The best informed commentators (such as the Reserve Bank) are talking about a slowdown in price increases - and not price decreases.
I expect those commentators will be correct.
If house prices in Auckland were to drop markedly, then people like me might be able to enter the market and purchase - but that's wishful thinking.......
https://www.interest.co.nz/property/88518/new-reserve-bank-figures-show…
My background is in research/analysis and policy. (Marketing/sales is not an area where I have any career experience.)
You could be part of a team that collects data via phone calls (CAPI). That would qualify you as having a "background is in research/analysis and policy." What kind of research / analytics are you interested in?
https://www.interest.co.nz/opinion/88483/election-more-any-others-recen…
Submitted by tothepoint on Tue, 27/06/2017 - 16:54
Hi Dictator,
You write: "The market is the market."
And therein lies the rub! One has to meet the market - the other way around doesn't happen.
For folks like me, waiting for Auckland house prices to come down would be a poor strategy. The market in Auckland can't be relied upon to stoop down and pick us up.
Nonetheless, guys like you and CJ099 are welcome to continue to try talking the market down. If you're successful, people like me will be enormously grateful to you. Please have no doubts about that.
Let's see what you can come up with next........."
In your comments above, you clearly say that you don't own property and are waiting for the prices to come down. If you deny any of that or try to weasel your way out, you'd be straight up lying.
Thanks Rich, I've also caught tothepoint out lying about his property ownership in a comment replying to gingerninja (See below or attached link). It just goes to prove how ridiculous he is.
Comment: by tothepoint | Wed, 28/06/2017 - 17:22
Quote: " If house prices in Auckland were to drop markedly, then people like me might be able to enter the market and purchase - but that's wishful thinking.......".
https://www.interest.co.nz/property/88518/new-reserve-bank-figures-show…
CJ099, RichMuhlach, I don't recall tothepoint ever saying he rented. All his comments could still be valid if he owned a property outside of Auckland or was talking about entering sub-markets within the Auckland district. For instance, "folk like me could enter the Ponsonby market..."
Popping over to interest.co.nz after taking the kids to their swimming lessons just now, read the headline, immediately thought... "I bet the butthurt has commenced already in the comments" and low the butthurt was plentiful.
If this bubble pop turns into a full on crash, I wonder if the spruikers will keep commenting?
Butthurt
An inappropriately strong negative emotional response from a perceived personal insult. Characterized by strong feelings of shame. Frequently associated with a cessation of communication and overt hostility towards the "aggressor."
CJ099?
Certainly not the great three, they're always upbeat.
Hi Gingerninja,
You write, "Yes, the great three, or as I envisage, The Mighty Cerberus (knowing much you like Greek Mythology Zachary ;-) )"
But getting back to the point (and as, no doubt, you have verified) there were only 3 houses listed this morning [1/7/2017] on realestate.co.nz for Ponsonby.
That's an historically low level of listings for this sizeable and popular Auckland locality.
Unquestionably, there are Auckland suburbs which continue to have buoyant housing markets - despite the gloom of winter and the various negative comments made here by certain people.
@Zachary: At lest we speak the truth and present evidence to support it! Rather than pushing the property ponzi scheme that would eventually drag us all in to a recession.
And at least I wasn't temporarily banned from this website like you Zachary for touting extremist views. :P
household saving ratio - which measures the amount they have available to save as a share of disposable income - halved to 1.7pc in the first quarter of 2017, from 3.3pc in the final quarter of 2016. This is the lowest rate since records began in 1963 and suggests Britons have been dipping into savings to maintain their standard of living.
1.7% ! Let's hope it's better in NZ...but I doubt it's significantly so......
http://www.telegraph.co.uk/business/2017/06/30/household-saving-drops-f…
Probably more like this:
Stagnant wages and soaring house prices have left 320,000 families trapped in their homes because they cannot afford to move and climb the property ladder
- UK has 320,000 ‘missing movers’ stuck in homes they can’t afford to leave
- Before the financial crisis, around 1.6m homes were sold a year
- Sales hit 1.2million last year but ‘missing movers’ made up most of the shortfall. Read more
It isn't true ! ... this is FAKE NEWS !!! ... it must be ...
... we all know that you can't lose with property , mate ... Lord knows we've been told so many times on this site ..." Land ; they aren't making any more of it "...
Move along folks ... nothing to see here ... just some scuttlebutt put out by someone who stirs more often than Nigella Lawson ...
... relax guys ... keep buying ... yes ... that'll cheer you up ... go to an open home , and pretend to the agent that you have a Chinese sounding name ... that ought to get them excited .... BUY !!!!
Yes, this time it is different. Remember Auckland is more resilient than London was in 2007 because Auckland is a destination city where international commerce thrives and people from all around the world want to live where as London is just some third world backwater with no productive industries or unique selling points. There are two types of people in this world - people who live in Auckland and people who are planning to move to Auckland. At some point everyone will live in an Auckland with roughly the same number of houses. This is why you can't lose on Auckland housing. Auckland property will rise forever, occasionally at 10%+ but if not at least 5%+. This is a fundamental law of nature like gravity and thermodynamics. If you aren't buying property with as much leverage as you can get your hands on you are losing money. Everyone is doing it, your neighbour is doing it, your in laws are doing, your taxi driver is doing, hell your grandmother is doing. How will you feel when they are multimillionaires with hundreds of properties. If you don't buy you will be the last person working in New Zealand, literally everybody else's will be property millionaires living luxurious lifestyles off the only perpetual motion machine in the universe - Auckland property. Still have doubts? Every heard of "safe as houses"? Exactly. Why buy an investment that is safe as houses when you can buy the actual house, with leverage. Duh!
The headwinds that were discussed since october are continuing to blow. The property bulls were in full denial over the last 6 months, some probably still are. Massive disconnection in incomes and prices had to correct at some stage. Chinese money had no impact says Nats. Stats now prove Nats were lying bleepers.
The double whammy - as from 1 July 2017
Has anyone seen this reported in the NZ media or is it alarmist fake news?
Buyers from China will face extra scrutiny of currency transfers abroad, with banks and other financial institutions in China now required to report cash transactions of more than 50,000 yuan ($9630), compared with the current amount of 200,000 yuan.
China’s banks will also have to report any overseas transfers by individuals of $US10,000 ($13,060) or more.
https://www.domain.com.au/news/thinking-of-selling-to-a-buyer-from-chin…
Are we selling nz to people oversea with there access to money, or are we selling nz to nz,er with our incomes, WE CANT DO BOTH, unless in very small numbers , and if we switch back and forth boom bust, wast of time, slow and NORMAL with a better use of rising and dropping interest rates, NORMAL
“We’ve been collecting property data for more than 10 years and never before have we seen so many apartments come onto the market in one month. With apartments typically being more affordable than houses, this has pulled down Auckland’s total average asking price for the month,” says realestate.co.nz spokesperson Vanessa Taylor.
Yvil, that is strange because when I do a search for apartments only on TradeMe for Central Auckland I'm getting back a figure of 935 which is considerably lower than when I last looked. However if what she says is true then it could skew the figures. Indeed it does appear that the majority have asking prices, unlike houses. So if apartments all lost confidence in auctions and went to negotiation then suddenly the "average" asking price would certainly drop. Apartments and houses should be separated in the statistics otherwise its kind of "fake news".
Anyone could see that Auckland and Christchurch were due for a correction. I tried on several occasions to advise people to reduce their portfolio and take some profits off the table. As a trader at heart I do that with my share portfolio regularly. Where the correction will go I have no idea. One thing I do know is that fear is a terrible thing and it makes some holders of assets panic when they see their assets drop in value. We are in interesting times and the upcoming election puts even more uncertainty on where we are going as a Nation.
gordon, you are a share trader indeed. I used to invest in the stock market too but I stopped because I was not good at it. Real estate is quite different and much harder to "trade" because of
1) the cost associated (RE fees, lawyers fees, staging or just bringing up the house to standard to sell, will cost $50K or more,
2) it takes several months to prepare, market, sell and settle on a house, during which time the market can and does change
I'm a (very) long term property investor and it doesn't phase me if house values go down for a while, especially after having surged for several years, it's to be expected. I know that, in the long run, my mortgages get smaller and the house values gets bigger, simple really.
Yvil I am not a share trader per se.I have a long term account that I added to last week and it holds one NZ stock. I have a trading account with limited funds in it. I have commercial property investments and residential land that is sold off in stages. I have never had a rental home . However as you can see I am reasonably diversified. Are you? how would you feel if your rentals dropped say 20 per cent ? They could . You have certainly missed out in not holding shares.
The beauty with property is that the longer you hold them the better it gets. I bought my 1st investment property 23 years ago, I am geared very lowly and I couldn't care less if real estate values fall by 20% or more. I would then simply look for opportunities to buy more, at discounted prices
Why are you always so envious of other people's success, Independent Observer? If someone is doing well you just love to cut them down and insist on showing them the downside. Don't be so bitter and jealous, mind your own business, I mean really look after your own business and do well for yourself
If you were Warren Buffet or George Soros sure I'd celebrate in your success Yvil. But to claim I'm envious of 'your success' is a pretty bold and narcissistic view point - are you claiming that you're a success? (I'm not envious of anyone who has made a lot of money through property investment - I actually feel sorry for them because it means they probably failed getting established in a profession and now have to speculate on houses to try and make a living..i.e. they couldn't get a real job e.g. TM2).
But the truth is, landlord'sim and property speculation in this country is morally flawed. Look at our poverty stats. Look at the mountain of debt we've created...Look at the amount of 'rent' young people/families are now paying and who at the present have no hope of getting ahead in this country. I can't say there's a definite correlation, but our suicide stats among young people are terrible and from talking to a lot of them, they're losing hope in ever being able to get by in this country.
So if you want to be a property bull and demand that other people join in the celebration of 'success' (as National like to put it and other turkeys), just take some time to double check how morally sound your position is.
From the UK Housing Market > Predicting up to a 40% price crash! Prices down 3 months in a row.
http://www.dailymail.co.uk/news/article-4657812/Britain-brink-housing-p…
I wonder if we will have the same issue with apartment settlement that developers are seeing in Aussie city's. That problem being that Chinese buyers not being able to settle due to cash restrictions, and walking away from deposits. http://www.ibtimes.com.au/chinese-buyers-australian-apartments-abandon-…
The Schools are already well over capacity and something has to give. Just imagine if the DGZ schools refuse to take the students destined for those developments, or shrinks the zone as proposed here...? https://www.parliament.nz/resource/en-NZ/51SCES_EVI_00DBHOH_BILL69778_1…
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