Barfoot & Thompson's median selling price down $117,500 from November peak

Property / news

Cooling Auckland housing market means fewer sales and lower prices for Barfoot & Thompson

3rd Mar 22, 10:36am by Greg Ninness

The cooling real estate market took its toll on Barfoot & Thompson's sales in February, with the number of sales and average and median selling prices all falling sharply.

The real estate agency, which is by far the largest in the Auckland market, sold just 750 residential properties in February, down from 801 in January and 911 in December.

It was also exactly a third less (-33.3%) than the 1124 properties Barfoots sold in February last year.

Prices were also lower with the median selling price declining for the third month in a row to $1,122,500 in February, which is $117,500 (-9.4%) lower than its November 2021 peak of $1,240,000.

The average selling price declined for the second month in a row to $1,196,036, down by $82,611 (-6.5%) from its December peak of $1,278,647.

Underscoring the slowness of the market was the fact that the total number of residential properties the agency had available for sale at the end of February (4385) was at its highest level for any month of the year since April 2019.

Barfoot & Thompson Managing Director Peter Thompson said rising interest rates and tighter bank lending had combined to take the heat out of the Auckland market.

"It's an indication that last year's aggressive rate of price rises has peaked and price increases are easing back as buyers take a more cautious approach," he said.

"Vendors will also have had time to reflect on the changing price environment, and whether they need to trim price expectations to achieve a sale," he said.

The interactive charts below show the long term sales and price trends at Barfoot & Thompson.

The comment stream on this story is now closed.

Barfoot Auckland

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Source: Barfoot and Thompson

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233 Comments

by Brock Landers | 3rd Mar 22, 10:39am 1646257199

🤡WBW said it was just SeAsONaL.

The bubble is bursting. Ouch.

by tothepoint | 3rd Mar 22, 4:35pm 1646278529

Only a fool would jump to conclusions from a single month's data from one agency - but there are many fools here. (Read their determinedly negative comments above and below.)

Notably, February's fall in median price is small compared with the gains over the past couple of years.

TTP

by Brock Landers | 3rd Mar 22, 11:10am 1646259017

November 2021 - 1240k

December 2021 - 1235k

January 2021 - 1180k

February 2021 - 1122k

Auckland Market Share 60.54%

Notably, those who were recently suckered into the mania are in the process of being ruined.

by Independent_Observer | 3rd Mar 22, 11:15am 1646259337

Amazing how house prices are inversely correlated to interest rates - yet we are told that inflation is good for house prices...well no actually global deflationary forces were good for house prices because it meant we dropped interest rates internally creating debt bubbles.

If inflation keeps rising and interest rates follow, and wages remain below the rate of inflation (as they are), then the amount of debt that can be serviced continues to be eroded by higher interest rate costs.

by theglc | 3rd Mar 22, 12:14pm 1646262862

This has little to do with interest rates but more with lending criteria.

To be far it only puts prices to where they were 6 months ago, in a normal market that would be pretty much unremarkable

by Yvil | 3rd Mar 22, 2:21pm 1646270511

It puts prices where they were 3 months ago, look at the graph for average and median prices

by Brock Landers | 4th Mar 22, 8:53am 1646337216

Mean three months.

The median is lower than August, so six months for that.

by ACB | 3rd Mar 22, 6:07pm 1646284031

You are confusing inflation and interest rates. Yes interest rates and inflation generally move in the same direction but not always. An increase in real interest rates (after inflation) will punish housing and other assets real value even if they are inflation proof (the land is anyway).

by HouseMouse | 3rd Mar 22, 11:24am 1646259878

So circa 10% fall in a short period of time.

Phenomenal, given how sticky house price declines can be.

by Albert2020 | 3rd Mar 22, 12:27pm 1646263670

"Notably, those who were recently suckered into the mania are in the process of being ruined".

Man you're a pathetic excuse for a human, slow clap for the big man who finds glee in the potential misfortune of others...

by Brock Landers | 3rd Mar 22, 1:25pm 1646267107

The editor ought to censor you for making unjustified and baseless personal attacks.

I have consistently warned of the risks of being sucked into the recent mania and have received considerable abuse for it on this website.

by Albert2020 | 3rd Mar 22, 2:00pm 1646269212

BL the only thing you have been consistent about these past 6 months is resorting to calling people stupid, dumb or crazy for having purchased a house recently with total disregard to their personal circumstances. We all know the housing market is broken but your negative commentary on a home buyer's personal decision just gets tedious and boring listening to the same broken record. Your reply calling for censorship is exactly the sort of response I would expect from someone being called out once again for your shameless behavior.

by Brock Landers | 3rd Mar 22, 2:41pm 1646271711

I've likely said something more along the lines of it being a crazy thing to do and that I wouldn't touch this housing market with a 10ft pole. That's not calling people names, that's just a statement of (as it turns out, correct) opinion.

I am not sure under what personal circumstances a FHB is forced at gunpoint to buy a grossly overpriced house right now instead of continuing to rent. Perhaps you could enlighten us? Are you one of the cannon fodder?

Your unjustified comment above "Man you're a pathetic excuse for a human, slow clap for the big man who finds glee in the potential misfortune of others..." does fall foul of the commenting guidelines. In particular "We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments."

Perhaps you would like to go familiarise yourself with them and apologise.

by Albert2020 | 3rd Mar 22, 8:23pm 1646292185

If only that was the case BL, I called you out only 2 weeks ago for labeling people idiots who have bought in the past few months. Go back further and you are relentless with the personal jibes. You are no messiah for stating that house prices are over valued, many have stated this including myself for the past few years. It was only a matter of time before house values started to fall.

I never said that FHBs were forced to buy, I stated that you calling them idiots, having not one iota of knowledge about their personal and financial circumstances is shameless and completely myopic. The time to buy a house for an owner occupier is when it suits your current personal and financial circumstances.

You want some enlightenment? Sure, if it makes you sleep at night. My young family bought our first home in December last year because we wanted the security and it was a beautiful property in a desirable location which we plan to make our own over the next 30 years. Importantly, despite its high price tag we can comfortably afford it.

It doesn’t concern me that house prices are dropping in fact for the benefit of society, including my younger brother who is locked out of the housing market they need to continue to drop.

My comments were completely justified BL; you seem to be a slow learner and I’ll call you out whenever I see fit. I’ll let the editor decide whether I breached house rules thanks kindly.

by Brock Landers | 3rd Mar 22, 9:41pm 1646296891

So TL;DR version you timed the peak of the market perfectly, but you don't care because you've got tons of money to throw away and anybody that expresses on a financial website that buying at the top is not a smart move is a "pathetic excuse for a human" and a "big man". But you're not upset.

Cool. Got it.

Let's hope that many others out there had more sense than money.

by Albert2020 | 3rd Mar 22, 10:44pm 1646300645

There’s a big difference between saying it’s not smart to buy at the top of the market and calling someone an idiot and stupid for buying a house to provide security for their family. We don’t even know when the peak is as your looking at three months of data. It was only 18 months ago sydney and Melbourne dropped 15% only to recover and exceed the so called peak. I don’t care if house prices drop because it’s outside of my control. How do you even get out of bed each morning thinking that way? Shouldn’t you be more worried about why you’re building a house in an area that’s under 10ft of water and has had one natural disaster after another?

by Brock Landers | 3rd Mar 22, 11:53pm 1646304798

Mate, buying into the blow off top of a Minsky credit bubble is providing financial insecurity for your family. Nobody called you an idiot personally, somebody on the internet just said that it was very dumb time to buy in. Which is now proving correct. Getting butthurt at somebody that was simply warning people not to make a financial mistake is very odd.

The exact timing of the peak is only visible in hindsight. But with Auckland commanding a premium over proper global cities like Sydney and London it was obvious to the astute observer that it was just a matter of time before the house of cards began tumbling down. Hugely overpaying for a home means a lower standard of living and higher debt for you and your family for a longer time. That's why one should care.

Only idiots fail conduct to due diligence on any property purchase. That's why I'm building on an area that's high and dry and isn't in danger of flooding or other natural disasters. It's an amazing, well located spot and a solid financial decision.

by Pa1nter | 4th Mar 22, 7:03am 1646330616

If its in bold, it must be true.

Everyone should praise Brock for such astute real estate decision making that he hasn't actually completed yet, but is going to spend 18 months trying to convince us all about.

There's absolutely no way the Aussie market could turn and his new house could be worth less than what he's paying for it. He requested the builder purchase all the materials in advance so that they're a) available and b) immune from material price increases. The builders costs are locked in hard for the duration also. He's done due diligence don't you know.

by Brock Landers | 4th Mar 22, 8:56am 1646337397

Thanks! I only mentioned it in passing a few times but you some of you are obsessed. Some people seem to get very threatened when they see others escaping the land of the long white price gouge.

Aussie construction isn't as much of a basket case as here so doesn't have the same severity of problems with materials, cartels and ineffecient trades. Fixed price build contracts are still standard and build costs per square meter are very much lower with the spec of the builds generally higher.

Build timelines are unfortunately a bit more stretched than normal, but I'm likely to have a finished home while you lot are still whinging about trying to secure plasterboard.

The market there will and has turned and prices are going to drop, of course. This is normal and will happen at different times and to different degrees in different states and local markets depending on how overvalued they are.

I purchased in a relatively undervalued market on the basis of it being relatively good value for money in a great lifestyle location with plenty of infrastructure investment in the coming years.

Very unlikely to fall below what I paid last year, due to intelligent buying. Minimal debt and an amazing family home. A bright future ahead!

by Pa1nter | 4th Mar 22, 9:29am 1646339343

Usually people wait till they actually accomplish something before boasting about it (those that feel the need to boast).

Then again they also wouldn't spend years bitching about a place they intend to leave, they'd just leave.

But good to see there's a polite rational explanation for your plans, while everything else is pooh-pooh doodiehead.

Spose being on here keeps you from annoying your husband, poor man.

by Brock Landers | 4th Mar 22, 4:28pm 1646364516

Boast? Years? Husband? Try posting with a clear head once the paint fumes have worn off.

by Albert2020 | 4th Mar 22, 10:45am 1646343925

Yes a sure sign he’s lost the argument. Haven’t heard a single positive thing written by him/her since being on here.

by Brock Landers | 4th Mar 22, 4:30pm 1646364625

What argument would that be? You whinging about being offended isn't an argument.

by Albert2020 | 4th Mar 22, 8:06pm 1646377568

The argument was that you have called people idiots, dumb and crazy for purchasing a house recently. Not sure why it’s an argument because one only has to go back and look at your recent posts to see that it’s a fact. You’re only triggered because you are finally being called out for your constant negative jibes at people who are just getting on with life rather than constantly worrying about what if. You’re never going to be able to time the market so just focus on getting that queensland house of yours built sometime this decade and lose the “woe is me” attitude that you are infamous for on this site.

by Fitzgerald | 5th Mar 22, 8:43am 1646423003

Can you all please just lay off BL !

It is pretty obvious that some of you are regretting your house purchasing decisions. But that does not give you the right to lash out at BL, as though he is somehow responsible for your problems.

by Albert2020 | 5th Mar 22, 9:52am 1646427154

What are you his mother? BLs a big boy, if he wants to throw muck he has to expect some in return.

by the way | 5th Mar 22, 12:19pm 1646435989

Albert, I'm struggling to find better explanation than multiple accounts.

Who else (other than his mother) would post such a comment?

by Luke83 | 3rd Mar 22, 4:14pm 1646277257

BL loves to jump on the wagon and name everyone stupid for being in the market. He can rep

by Luke83 | 3rd Mar 22, 4:16pm 1646277383

BL loves to jump on the wagon and name everyone stupid for being in the market. He can report me if he likes but he is a negative little twit.

by tomjones_04 | 3rd Mar 22, 4:24pm 1646277887

Puke83… we are all equal here. My opinion is just as important as yours and Brocks. Emotional outbursts are a sign of a lack of control. Not the most masculine display there dude

by Brock Landers | 3rd Mar 22, 5:02pm 1646280147

Is it because your latest speculative gamble is going backwards that you are lashing out?

by Market Interest | 3rd Mar 22, 6:12pm 1646284325

Now, now, gents, play nice. Plenty of good perspectives on both sides of the argument.

by HW2 | 3rd Mar 22, 6:22pm 1646284978

Just dont fixate on the latest price estimate every day or minute. Enjoy the property and set about making it better. Nobody has to be a victim of a falling market, start making value-add small improvements and unlocking potential. Applies to every property.

by Independent_Observer | 3rd Mar 22, 6:30pm 1646285435

Oddly my experience of watching house prices tumble in the USA during the GFC, the opposite of what you say above played out. People didn't have the spare cash to spend on renovations, banks wouldn't lend to do rennovation work on houses, and also psychologically people didn't want to spend money on something that was losing value as they saw it as a direct sunk cost.

So if prices do keep falling, you might find that the vast majority do the exact opposite of what you suggest.

But that was the real world....not the New Zealand property market so probably not true.

by HW2 | 3rd Mar 22, 9:45pm 1646297153

Have lived through multiple recessions and by following the formula have made tons on every house bought and sold at that time. 50 to 100 percent and more of the purchase price which we leveraged and made many times bigger margins. My current house on half an acre bought 3 years ago has just been rezoned resi... boom. Forgive me for the little boast, no mortgage on this property

by Independent_Observer | 4th Mar 22, 8:39am 1646336390

Nice - well done 🙂

by Brock Landers | 3rd Mar 22, 7:30pm 1646289010

Luke83 has been in here bragging about his off the plan high leverage house flipping since the middle of last year. The suburb is a super-secret though.

If I recall correctly, there was a third roll of the dice taken around November.

by Independent_Observer | 3rd Mar 22, 7:51pm 1646290262

Yip there are going to be some stressed souls if the market keeps falling - those who were overly confident or arrogant suddenly go quiet. Watched it first hand in 2008 in US. You see a whole new side to peoples personalities when it dawns on them that they might be bankrupt because of their over confidence and greed a year or so earlier.

by Independent_Observer | 3rd Mar 22, 6:34pm 1646285684

There appears to be a direct correlation between the amount of debt/exposure a person has to the housing market and how quickly they become a promoter for it and to what extent.

Very similar to a ponzi scheme where once you are in, you absolutely have to find the next buyer to protect your investment.

As opposed to just a normal property market where you buy a house, settle down and having some kids and don't bother anyone else about how they have to be buying houses also and that prices could never drop.

by HW2 | 3rd Mar 22, 9:40pm 1646296819

Keep telling yourself that, you will feel a lot better and not be needing those weekly appointments. +ve self talk, and comparisons against others

by Luke83 | 4th Mar 22, 7:12pm 1646374323

Far from it, if your set up to fail because interest rates go up a few percent then you should not be in property.

by northman46 | 3rd Mar 22, 1:31pm 1646267489

Observing or warning isn't finding glee at others misfortune.

Greedily rubbing ones hands together since 2020 at how much more we could squeeze out of our youth, however...

by rastus1 | 3rd Mar 22, 2:55pm 1646272507

Well said. I feel for the one house fhb’s but will certainly enjoy the demise of the majority of the landlording class. They have been the most destructive force on Nz inc by a country mile. The dispicables.

by Luke83 | 3rd Mar 22, 4:18pm 1646277535

Do you actually think that a a slow down and slight drop of say 10% is going to do that then your actually very confused

by rastus1 | 3rd Mar 22, 7:21pm 1646288465

Where did I say that Luke who cannot read?

by Yvil | 3rd Mar 22, 3:55pm 1646276115

Since 2020? Do you mean since 1992 ?

by Albert2020 | 3rd Mar 22, 8:28pm 1646292528

If they were only observations you would be correct but if you’ve been on here for at least the past 6 months you will be well versed in BLs constant negative jibes at anyone who has decided to enter the property market regardless of their personal circumstances.

by printer8 | 3rd Mar 22, 10:49pm 1646300992

Albert

Congratulations. I know that you will be enjoying the social and financial security as well as the intrinsic value of owning your on home. As I have posted many times; unfortunately what many on this site can't get their heads around is that owning a home is a long term commitment and short term fluctuations in the market are irrelevant - same house whatever the market does. The only factor of importance to a FHB is servicing the mortgage; and I wouldn't worry about any negative posts regarding that as they don't know your situation while your bank does and would not be lending if they were not confident - and that is considering their fairly extreme expectations of the market.

As for Brock Landers, I don't give his any comments any credence at all. He has called this country and everything about it "shite" and that he was leaving once he got "some ducks in a row"; that was two years ago and he still hasn't been able to organise it. He reminds me quite a bit of a guy at the pub on Friday night we all call "Piss and Wind" - he goes on and on thinking he knows it all, saying what he is going to do but never does, and just talks utter rubbish. Ironic that Brock calls Ardern and Orr incompetent while not being able to organise that simple move to Australia.

Its great that you are on the road to paying your mortgage down. Meanwhile Brock's landlord will be happy as Brock continues to pay down his/her mortgage.

Cheers

by Albert2020 | 3rd Mar 22, 10:46pm 1646300787

Thanks printer, that’s an accurate synopsis.

by Brock Landers | 4th Mar 22, 12:20am 1646306419

This reads like the fictional rantings of an abusive spouse angry that their partner is moving on.

The mask has really slipped.

by swapacrate | 4th Mar 22, 10:13am 1646342029

I think most people on here own a home, but they want NZ to have affordable homes for NZ and future NZers. Not for a house to be unattainable. You guys take it to an extreme and fight for houses to be on average 1 million dollars or more whilst average incomes are 10 to 12 times less then this. It helps you personally but not NZ. This is sociopathic and narcissistic behaviour. Everyone wants people to own a home, that's their argument and you know it, but you twist words.

Im pretty sure your talking about yourself and not Brock in your comment. Not to speak for you Brock, but Brock will own a home as he seems plenty intelligent, and he will most likely pay good value for that house, and not over inflated bubble prices. Property just needs to align with average incomes. Not hard to understand.

by DTRH | 3rd Mar 22, 11:12am 1646259146

Me and a number of other people told you November December was top.The interest rates have hardly gone up yet still much more to go and with inflation high the only way housing market is going is down hopefully to a place where average wage earners can afford to buy. I said anyone who purchased in last 2 years will see deposit gone and be in negative equity over next year or two .So many people bought well over value through FOMO let hope they made money on way up because the prices are going down in chunks.

by Independent_Observer | 3rd Mar 22, 11:17am 1646259457

Yeah was wondering that - how many young FHB's with high LVR's might be approaching or in negative equity already and the pain of higher interest rates may only just be starting, let alone any further falls in prices that would leave them in negative equity for who knows how long? (if like Japan it could be decades)

by Dale Smith | 3rd Mar 22, 12:19pm 1646263156

The debt then just falls on their underwriters, ie the bank of Mum and Dad.

But as long as they can keep paying the mortgage, ie not sell, even if it is in negative territory, then the true decline in value is never recorded statistically.

by Independent_Observer | 3rd Mar 22, 12:35pm 1646264146

Hopefully one never needs to sell in divorce or work relocation.

by gnx | 3rd Mar 22, 12:22pm 1646263351

And haven’t the banks been bundling the mortgages up and selling them to the treasury?

you couldn’t make this s**t up

by swapacrate | 4th Mar 22, 10:16am 1646342186

Genuine question is this true. Wow if it is.

by Miguel | 3rd Mar 22, 12:07pm 1646262434

Keep shifting those goal posts. First it was “December is just one month”

Then it was “You can’t trust January’s figures it’s a slow month”

Now we have 3 months, included a month normally considered high volume month, all showing the same trend

Yet you still claim people are basing conclusions on a single month? Pathetic

by HouseMouse | 3rd Mar 22, 2:29pm 1646270975

Yeah it's pathetic and desperate.

by lekkerbydiesee | 4th Mar 22, 9:24am 1646339097

by single month, do you mean 3 months data? ;)

by mfd | 3rd Mar 22, 10:56am 1646258173

The data must be wrong - CWBW's boys promised him, and he even knocked up a test of statistical significance to prove that average prices would be up in February.

https://www.interest.co.nz/property/114277/buyers-are-being-more-cautio…

by Miguel | 3rd Mar 22, 11:56am 1646261805

It’s pretty amusing that he was still claiming he was “right” as of yesterday, but trying to use a backward looking dataset.

Don’t forget CWBW was claiming February figures for Auckland would be double digit growth for February.

The guy is either a complete fool or just completely dishonest.

by Brock Landers | 3rd Mar 22, 1:19pm 1646266742

With fuzzy logic and quantum mechanics you can come to some very strange conclusions.

by Luke83 | 3rd Mar 22, 11:40am 1646260826

Yea.... Okay, if this is true why not comment on other stories that report increases still that the market is actually still climbing.... Doom

by mfd | 3rd Mar 22, 11:47am 1646261224

Those articles are becoming hard to find these days as prices are clearly falling, with the exception of the delayed Corelogic data which will catch up in time.

Not really a 'doom' scenario though - just prices becoming more sensible. I own my home, but happy to see prices falling for the good of the country.

by HouseMouse | 3rd Mar 22, 11:49am 1646261393

And it may be that it's not quite a 10% decline as these figures show, possibly 5% thus far...

by rjn1 | 3rd Mar 22, 11:58am 1646261936

No one believes the market is still climbing. Stop looking at laggy data.

by Miguel | 3rd Mar 22, 12:00pm 1646262011

Those articles use YoY measures. We now have 3 months of steady declines in prices which indicate the market has shifted.

Feel free to stick your head in the sand, but things have definitively changed from the conditions in 2021

by HouseMouse | 3rd Mar 22, 12:05pm 1646262315

Property spruikers will remain in denial, trust me.

by tothepoint | 3rd Mar 22, 12:58pm 1646265502

Hi HouseMouse,

If you specifically have to request that people trust you, it’s a sign that you think they probably won’t.

TTP

by theglc | 3rd Mar 22, 3:01pm 1646272879

you forgot to remind us that there is a soft landing coming...

by gingerninja | 3rd Mar 22, 11:41am 1646260874

And building company’s going under already, although the narrative doesn’t quite make sense to me.

The building industry has been drowning in work, increasing wages regularly and every builder I know, was well aware of all the price increases (which have been happening for well over a year) so most had baked that in. I suspect this building firm is not being completely honest about why they are going bust.

https://www.rnz.co.nz/news/business/462627/failure-of-otago-building-co…

by HouseMouse | 3rd Mar 22, 11:54am 1646261669

Don't know how much you have been following the website over the last year - I have been consistently calling a house building slump / crash later in 2022.

So no surprises to me.

Almost no economists have been talking about this, although Tony Alexander raised it a couple of months ago. And P8's untouchable favourites ANZ raised it last week.

Pure negligence / mediocrity.

by gingerninja | 3rd Mar 22, 1:42pm 1646268169

Housemouse, I’ve been reading articles here and there but avoiding comments mostly.

I agree and certainly assumed that there might be a building slump or crash in the future, but didn’t think the rational given by this particular building company made sense or that building companies would start going bust this quickly.

I was wondering if maybe they had taken on substantial debt ( possibly buying land to develop) and with credit conditions tightening, experiencing cash flow issues?

The building industry have had a good few bumper years, they’ve been drowning in work and demanding higher and higher salaries. A sensible business makes hay while the sunshines. The pandemic thus far hasn’t hit salaries or profits for the building industry beyond them not being able to keep up with demand. The delays have been occurring since the start of the pandemic, whereas credit tightening has been biting more recently.

by Kjeldorian | 3rd Mar 22, 1:44pm 1646268294

The delays have been getting worse and worse. They might have started at the start of the pandemic but they are at their worst now.

by gingerninja | 3rd Mar 22, 1:59pm 1646269177

Gotcha. So does that mean tradies are already just sitting about twiddling their thumbs because there are no materials then? Everyone still seems super busy but maybe it’s about to fall off a cliff face?

by Kjeldorian | 3rd Mar 22, 2:25pm 1646270707

Tough to answer. If builders are on to it and have been keeping up to date then they are ordering stock well in advance and have multiple jobs on the go (which require different materials) so if there is a delay on one site they can work on the other.

Some builders are still going in to merchants and expecting to pick up the materials they need same day. These are the guys who are going to go under. Some examples of current lead times; Frame & Truss 6-8 months, Gib 3-4 months, Weatherboards 6-9 months...

by gingerninja | 3rd Mar 22, 3:03pm 1646272989

I had checked out of reading housing market/building news over the last 6 months. I had been intending to break ground on a build late last year summer. Was initially supposed to be 2020 but we had major NIMBY push back on our Resource Consent, to add to the covid delays…. And then we also had a major renovation over 2019/2020 (including extensions) so we were just burnt out. My builders are amazing, but they were just stressed out of their noggins with the amount of work and supply issues so I didn’t want to add to their stress either. They had more than enough work on.

Now they’ve changed the Resource Consent legislation too and we can actually build what we want and not even require an RC so we’re happy enough to go back to the drawing board and delay further still. My builders know they’ve got our job on the back burner when things calm down but looks like these major supply issues will push things out even further.

I was just trying to catch up on it all. Gib rationing! It’s nuts!

by Kjeldorian | 3rd Mar 22, 3:10pm 1646273440

I'm glad you've got a good builder!

Add to all of this that prices for materials keep going up as well. We could easily see another year of 3x timber price increases, the market is insane. I've never seen it like this!

by gingerninja | 3rd Mar 22, 3:27pm 1646274444

Yeah, how have lenders been dealing with that though? The banks usually want fixed priced contracts but how can that work if prices are going up every 2 months and there are massive delays?

by Kjeldorian | 3rd Mar 22, 3:40pm 1646275219

Not my area of expertise but I expect some builders will build more margin into their build to reduce that risk. I've heard of builders putting in clauses into their contracts to make allowances for price increases but imagine banks would be hesitant to lend if those clauses are in there. Could be another reason for reduction in lending?

by gnx | 3rd Mar 22, 4:18pm 1646277484

Sounds like an open check book...what could go wrong?

by northman46 | 3rd Mar 22, 2:12pm 1646269978

And welcome back!

by gnx | 3rd Mar 22, 12:25pm 1646263501

Funding the endless delays drains the cash for one reason

by VTHO | 3rd Mar 22, 1:29pm 1646267382

Where is he anyway, was looking forward to his spin on this one.

by HouseMouse | 3rd Mar 22, 2:00pm 1646269216

Yes it's much less fun without the clown.

by Hastings | 3rd Mar 22, 10:32pm 1646299977

Not sure why anyone bothers with NZ property. Almost given up trying to maintain the basic house I own and live in. For example there’s only one guy doing tiled roofs in Dunedin, try finding a good builder whose available anytime before 2025. Anything nice is beyond reach of the average family so can’t imagine there won’t be quite a few one way departures from now on.

by HouseMouse | 3rd Mar 22, 10:37am 1646257077

Be Quick !

by Plutocracy | 3rd Mar 22, 10:45am 1646257527

Buy high, sell low!

by Dgm | 3rd Mar 22, 10:53am 1646257999

Where is Mr. BuyLowSellHigh?

by tothepoint | 3rd Mar 22, 10:57am 1646258222

No doubt Mr BuyLowSellHigh is now preparing to buy.

TTP

by Independent_Observer | 3rd Mar 22, 11:22am 1646259748

Does he not like his fingers?

by mfd | 3rd Mar 22, 11:26am 1646260005

Good to be prepared, but no signs that we've arrived at the time to strike yet.

by Notgreedykiwi | 3rd Mar 22, 12:19pm 1646263157

FHB's shouldn't buy now suerly. Let the OCR reach 3% and then buy. You might pay a bit more on interest but you will get it at a price lower than today.

But then if you already own a house to live in. What's the need to buy more or i would say it's just the greed.

by Slapheid | 3rd Mar 22, 10:38am 1646257132

So now even more room for an upward valuation, amiright?!?!

by Jonny_Utah | 3rd Mar 22, 10:41am 1646257276

It’s okay the boys in the basement modelled this!

by HouseMouse | 3rd Mar 22, 10:45am 1646257524

They have got it wrong, CWBW needs to go down and get medieval on their asses.

by Jonny_Utah | 3rd Mar 22, 10:54am 1646258088

Quite, their high salaries depend on it.

by xingmowang | 3rd Mar 22, 10:40am 1646257207

here goes the 10%.

still another 10% to go.

by fortunr | 3rd Mar 22, 10:42am 1646257378

still another 20 to 30% to go

by realterms | 3rd Mar 22, 11:17am 1646259428

I never would have guessed it a year ago, but I'm beginning to think that xingmo knows what he's on about in this particular domain. I almost miss the absurd CCP party-line parroting on anything pertaining to China though.

by user123 | 3rd Mar 22, 6:42pm 1646286125

I would wager we'll be down 20% by the end of 2022. And there could easily be further pain in 2023.

by rjn1 | 3rd Mar 22, 10:42am 1646257374

It's an indication that last year's aggressive rate of price rises has peaked and price increases are easing back as buyers take a more cautious approach

Seriously? Price increases are not easing back, they are negative - why must they persist with this silly narrative?

by fortunr | 3rd Mar 22, 10:44am 1646257468

there were comments on this very site, no longer than a couple of days ago, stating that there was still room for upward valuations :-)

by CourtJester | 3rd Mar 22, 12:17pm 1646263073

If you think about it, as prices go lower there will be more and more room for upward valuations.

by HouseMouse | 3rd Mar 22, 10:48am 1646257716

Well put, misleading statement. What a weasil.

Increases are not reducing, prices are actually declining!

by Independent_Observer | 3rd Mar 22, 11:36am 1646260571

Property industry newspeak.

by HouseMouse | 3rd Mar 22, 11:55am 1646261712

^{AKA a lie. Because it is}

by Independent_Observer | 3rd Mar 22, 12:06pm 1646262409

And like any self serving ideology, if you challenge it or call it a lie you get bullied (in this case as a doom gloom merchant) in the hope you will be silenced.

by Poldark | 3rd Mar 22, 10:43am 1646257386

Stock up

Median price down. Average price down.

Can someone spin this with statistics for me? What will the herald report?

by rjn1 | 3rd Mar 22, 10:45am 1646257502

The annual rate of growth is still strongly positive.

by Squishy | 3rd Mar 22, 10:46am 1646257612

That's while inflation is fierce at circa 6% as well so in real terms it's a bigger hammering.

Glad I got out in time (except I'm sitting on too much cash so - not all good.) Typically housing markets approximate a sawtooth pattern with long ramp-ups and sudden, brutal declines when they do come.

by Macrology | 3rd Mar 22, 10:44am 1646257478

Clear signal of direction, but I'd wait for REINZ before putting a magnitude on it.

by hum | 3rd Mar 22, 10:44am 1646257482

This is under 10 % and as have said for long. the market is heading for a soft lending.

PPT

by rastus1 | 3rd Mar 22, 10:48am 1646257737

'hum'...... as in humour I assume?

by rjn1 | 3rd Mar 22, 10:53am 1646257980

Must be having a laugh. Although to be fair, is a soft landing still considered such after a gut-wrenching depressurisation and emergency descent?

by hum | 3rd Mar 22, 11:19am 1646259544

Yes lol the guy has been writing the same comments every days, so I thought ill do it for him this time.

by Squishy | 3rd Mar 22, 10:50am 1646257806

Since November though. Soft landing or nosedive?

by Orontogosh | 3rd Mar 22, 11:19am 1646259567

TTP's p...rediction has been soft for so long he's forgotten what hard looks like.

by Nifty1 | 3rd Mar 22, 10:45am 1646257509

So we should just totally ignore Corelogics figures?

by rjn1 | 3rd Mar 22, 10:50am 1646257825

Say it with me now…..

Core Logic’s figures are only good for the history books, the have no business in the here and now.

by Macrology | 3rd Mar 22, 10:53am 1646258001

Yes - as a timely indicator they should be ignored. Unless you're interested in what the market was doing a few months prior. That said, barfoots is a low sample size and not a proper index. So while timely, it's very volatile. That's why I wait for REINZ, which is much more reflective of current conditions compared to corelogic/qv while stripping out dodgy compositional effects e.g. if only cheap houses sold (corelogic does also does this, but barfoots is a simple median or average so is problematic)

by Carlos67 | 3rd Mar 22, 11:14am 1646259284

Nothing wrong with Corelogics figures. To be fair you need to look at year on year these days with the rapid increases and now the rapid decreases to help smooth out the spikes. Prices still need to fall a massive amount to get back to where they were 18 months ago.

by rjn1 | 3rd Mar 22, 12:07pm 1646262423

No way, I’ll look at actual price track thanks. 3 months makes a world of difference these days, so you need to look at granular, up-to-date data to appreciate the unfolding trend. There are the usual disclaimers about volatility, but it’s easy enough to establish what you’re looking at. Year/year allows the spin team to talk about reduced rate of price growth when the market is clearly heading South - not good or helpful, in fact it’s bordering on corrupt.

by WhiskeyJack | 3rd Mar 22, 10:47am 1646257640

Assets prices collapsing, inflation raging, interest rates going up, global plauge, WWIII starting. This year is rapidly turning to crap, even worse than last year.

by tronic | 3rd Mar 22, 11:43am 1646261001

At this rate we'll have Armageddon come 2023

by linklater01 | 3rd Mar 22, 11:53am 1646261608

whiskey(Irish I presume) Jack,

"Assets prices collapsing", not quite, at least not yet. I have been around the stockmarket professionally and personally for some 50 years, but i will admit to being puzzled by the resilience of the NZ market-so far. To date, it's down less than 10% from its peak and I can't see why.

I have taken a lot of money out of the market over the past couple of years, but wouldn't dream of buying back yet. I know that many of our companies have reported decent results and indeed have announced dividend increases-up to 18% in one case. Nevertheless, given the issues we confront today, I still expect to see a further significant fall, probably up to bear market territory. Then there will be some attractive valuations on offer.

by WhiskeyJack | 3rd Mar 22, 12:54pm 1646265290

True not collapsing, not even a correction yet, could be worse.

I'm not sure if housing is classed as an asset like stocks but I tend to think they serve a similar purpose.

by Fluffybunny | 3rd Mar 22, 1:19pm 1646266759

The nzx provides a reasonable yeild still. Compared to say, highly over priced usd tech stocks.

Why not resilient? Bubbles come go, but companies in nz will continue to function. We will keep growing stuff.

by Clementé | 3rd Mar 22, 12:11pm 1646262704

Welcome to the fourth turning .

by Independent_Observer | 3rd Mar 22, 12:34pm 1646264044

Exactly - I was sceptical at the start about that book but it really resonates with me now.

by Caughtinthemiddle | 3rd Mar 22, 10:47am 1646257641

I've posted a couple of times that I felt the market may have a tipping point. Perhaps there is a theoretical threshold that sees investors moving more as a herd because the financial matrix that makes property attractive to stay in as an asset class starts to leak oil too fast. I wondered if we'd ever see a negative change in valuations steep enough to reach such a threshold.

These numbers suggest we may yet hear the sound of hooves on the stampede.

by Dgm | 3rd Mar 22, 10:51am 1646257916

No turning back, pity those who held back from selling..and pity those who bought at the peak

by tothepoint | 3rd Mar 22, 10:55am 1646258117

Hi DGM

Those who bought at the recent peak will be smiling at the next peak.

TTP

by company of heroes | 3rd Mar 22, 11:00am 1646258434

They will likely need to wait for a while, there will be some pains and tears before that happens too...

by Brock Landers | 3rd Mar 22, 11:13am 1646259186

It's unlikely that real house prices will exceed the recent peak during their lifetime.

That smile may just be rigor mortis.

by Independent_Observer | 3rd Mar 22, 11:19am 1646259574

I don't think TTP understands what real house prices are. He just understand real estate.

by Pragmatist | 3rd Mar 22, 12:12pm 1646262765

Or maybe he's just smart enough to know that 'real' house prices don't matter.

Why would I care that my house price is now 20x some basket of goods when it used to be 30x that same basket of goods. Usually just means the basket of goods got more expensive. Also mean the mortgage is now only 10x that basket of goods instead of 15x. Couldn't give a hoot, tell me what it is in nominal dollars, or in multiples of my income, those are the numbers that matter.

by Independent_Observer | 3rd Mar 22, 12:31pm 1646263885

Those other numbers also indicate the housing market is severely overpriced. So the market looks exceptionally expensive in both nominal and real terms.

However per the original point, this could be a peak that in real terms is never again visited. Which in the investment world, means that you might have just purchased an asset at the worst possible point and from here on in you are losing purchasing power and not just now, but into the future.

by Pragmatist | 3rd Mar 22, 12:37pm 1646264259

At some point you'll notice that in the real world, you can't build the house for 3x average household income, even if the land was free, so you have to realise that the 3x income number is nothing but a fantasy (in NZ at least), it ain't going to happen no matter how long you hold your breath and beat your fists on the floor.

Edit: and to the bit you added latter. That applies if you are paying cash, but if like most property buyers you are borrowing to purchase, that same inflation just deflated the "real" value of the debt you used to purchase it, so its not a bad thing at all (so long as you don't get caught short on the servicing of the debt)

by Independent_Observer | 3rd Mar 22, 1:45pm 1646268350

As it stands wage inflation is far below CPI meaning debt payers are getting poorer on a daily basis and their ability to service debt is getting worse, with the likelihood of further mortgage rate increases.

But yes of course inflation is your friend to deflate away the debt you've taken on.

Worked great in the 1970's and 1980's but people didn't have million dollar mortgages then or buy when houses were price 10:1 incomes.

These are very different times!

by Pragmatist | 3rd Mar 22, 3:13pm 1646273605

LCI is generally above CPI as shown in the first graph on this page (https://www.stats.govt.nz/news/wages-continue-steady-rise). I expect they will start catching up to recent CPI increases in the next quarter.

by Fluffybunny | 3rd Mar 22, 1:51pm 1646268694

That's potentially a long time. Or not.

Look at Japan or Ireland inflation adjusted indexs.

by company of heroes | 3rd Mar 22, 10:58am 1646258300

Yeah greed is the worst enemy for investors. Smart investors are not focusing on timing the market but accessing and managing risk.

by JJS | 3rd Mar 22, 11:13am 1646259224

I was tempted to sell my family home Oct/Nov last year but the wife didn't want to sell until we found something to buy. Kind of kicking myself that we didn't looking at how prices are falling. However, from the auctions I watch quality family homes on decent plots in the Central Auckland suburbs don't seem to be getting any cheaper

by rastus1 | 3rd Mar 22, 11:28am 1646260094

Same situation JJS, however I'm not kicking myself as nothing is certain and the investment in the family home is not worth risking. The best time to upgrade is when the market is falling, so it will still work for you. We are only at the start of this cycle.

by swapacrate | 4th Mar 22, 10:22am 1646342547

But you have to buy a house though. Wouldn't it be better to upgrade when market has dropped, your mortgage will be less. I remember 5 to 10 years ago an upgrade was about 50 to 100k more, now its 300 to 500k more.

by Reverse_hedge | 3rd Mar 22, 10:55am 1646258113

That soft landing is starting to look pretty hard.

by Independent_Observer | 3rd Mar 22, 11:07am 1646258845

Adrian must be crapping himself - house prices falling and inflation rising out of control..the definition of hell for a modern central banker.

Must be time to remove LVRs again…surely?

by Notgreedykiwi | 3rd Mar 22, 12:23pm 1646263383

Do you think he has the brain cells to understand this? He is in the la la land. The ching ching monkey playing instruments

by JJS | 3rd Mar 22, 11:11am 1646259070

I agree prices are softening - but these stats might be made worse by B&T losing market share in the top end? You look at Remuera, Parnell, Herne Bay, Ponsonby etc - Ray White, Bayleys, UP seem to list a lot more properties than B&T.

by Carlos67 | 3rd Mar 22, 11:19am 1646259594

Looking purely at Auctions is probably not a great idea. overall sales would be the way to go, even then things can be altered by the types of properties selling. Nothing is really that consistent in terms of sales, one needs to look at the long term trend.

by Brock Landers | 3rd Mar 22, 12:15pm 1646262921

The data for this article is all sales for B&T, not just auctions.

by Wrong John | 3rd Mar 22, 11:16am 1646259366

B&T is a sample. Nothing more. You could argue that their numbers are worse than others. They would argue otherwise. March is usually a big month. Exactly what sort of big we're about to find out. I'm keeping my powder dry for the end of the winter - another 5-6 months away.

by realterms | 3rd Mar 22, 11:20am 1646259637

Auckland stock now up 72% from the low point in September 21, and still rising fast. Looks like one-way traffic at the moment.

by Pragmatist | 3rd Mar 22, 12:20pm 1646263204

rising fast? the new listings in the graph above is lower than any point thats not a december or april 2020 when the country got completely locked down.

"Underscoring the slowness of the market was the fact that the total number of residential properties the agency had available for sale at the end of February (4385) was at its highest level for any month of the year since April 2019."

Highest point for 3 years, not decades.

by realterms | 3rd Mar 22, 1:11pm 1646266316

Total stock. Not new listings. I keep my own data. Yes it's the highest since mid-2019. Who said anything about decades?

by Pragmatist | 3rd Mar 22, 3:17pm 1646273843

Just pointing out you are making it look like some massive increase in stock by cherry picking a extraordinarily low base.

by realterms | 3rd Mar 22, 3:56pm 1646276214

Yes I explicitly said that it was the low point (at least a 5 year low), which coincided with a very strong run-up in prices. The stock increases since then are also quite substantial.

by mja | 3rd Mar 22, 11:18am 1646259486

A 33% fall, fully erases a 50% gain.

by kiwikidsnz | 3rd Mar 22, 11:33am 1646260410

Not a lot of people remember that.

by HouseMouse | 3rd Mar 22, 11:56am 1646261770

Simple math!!!

by Oasis | 3rd Mar 22, 11:19am 1646259560

This is great news. However I’m also starting to see changes in sellers’ inclinations to sell. Where I live used to get flooded with 40+ listings per week the past couple of months. This week less than 15 so far. Land & house packages hardly seem to sell nowadays for obvious reasons. I wonder if a stalemate situation is developing between buyers & sellers..

by northman46 | 3rd Mar 22, 11:27am 1646260034

Where abouts? Because Wellington City, at least, is pumping. Almost 900 listings. I don't think I've seen that high before.

by Oasis | 3rd Mar 22, 11:30am 1646260259

A place much smaller (let’s say < 200,000 people) than Auckland & Wellington 🙂. I guess we never experienced the crazy building boom that bigger cities had..

by gingerninja | 3rd Mar 22, 11:37am 1646260638

Same northman46. I’ve been stunned by the sheer number of listings coming on every day.

by Reverse_hedge | 3rd Mar 22, 4:00pm 1646276404

TradeMe is just about to hit 30k listings. The rush for the exit is in full swing.

EDIT - just checked again and there's been another 200 added. Be quick!

by Nzdan | 3rd Mar 22, 8:28pm 1646292500

Masterton starting to see the "price reduced" listings. It was dead in November/December when we traded up, received one bid on our property when we sold, open homes were dead.

https://www.trademe.co.nz/a/property/residential/sale/wellington/master…

https://www.trademe.co.nz/a/property/residential/sections-for-sale/well…

https://www.trademe.co.nz/a/property/residential/sale/wellington/master…

by VictimOfOCR | 3rd Mar 22, 11:24am 1646259851

Wouldn’t that make it likely low equity borrowers may already be in a negative equity situation? Hope they fixed for a a few years as renewal time is otherwise going to be rough.

by WestieAJ | 3rd Mar 22, 11:30am 1646260210

So in Feb. Barfoots sold 750 properties for average of 1196036. Total $897,027,000.

Commission on standard structure 3% on 1st 300k and 2% after that.

Average $26,920 per sale. 20.19 million in a month.

December sales 911 @ $1,278,647 average $1,164,847,417 total

Average $28,572 per sale. 26.03 million in a month.

77 Branches. The canary will be if any of those start to close

by AJ123 | 3rd Mar 22, 11:31am 1646260291

Still long way to go, the asking price for shoe boxes in the outer suburb is 950K to 1.1mill which nowhere justify the prices.

by Fitzgerald | 3rd Mar 22, 11:43am 1646261017

Watch those prices halve 🙂.

by Clementé | 3rd Mar 22, 12:21pm 1646263281

I’m currently in Melbourne on a work trip, in fashionable north-ish suburbs with tram stops outside (the tram experience is very good btw). Brand new 1 bed appartments being advertised on signs outside the build for $444kaud

find me anything in an nz major city that would get you on the ladder for that price.

not to mention oh a few annual world class sporting events turn up here, comedy festival with the world biggest names, touring music artists will stop here on any aus tour, generally a very good vibe … no brainer if you’re a 20/30 something imo

by Kjeldorian | 3rd Mar 22, 1:23pm 1646267017

"find me anything in an nz major city that would get you on the ladder for that price."

Ok, go on TradeMe.

Use these filters:

Auckland City, Price $100k-$450k, Bedrooms 1+, Property Type: Apartment.

362 results.

Do you want me to look at all areas of Auckland, Wellington, Christchurch as well?

by Brock Landers | 3rd Mar 22, 1:30pm 1646267458

It's a shame that TardMe doesn't have a filter the three L's... leasehold, leakers and lies.

by Kjeldorian | 3rd Mar 22, 1:37pm 1646267828

This is exactly the response I was expecting.

"Find me X"

"ok, here is X"

"But that doesn't fit my narrative!!!"

by Fluffybunny | 3rd Mar 22, 1:55pm 1646268912

Would be interested to know body Corp, ownership arrangents etc, when comparing straight prices in apartments. There are reasons some apartments go so cheap.

by Brock Landers | 3rd Mar 22, 1:58pm 1646269080

Cool story bro.

But the point still stands.

A large portion of those results are going to be utter bunk, for the reasons outlined above.

by Kjeldorian | 3rd Mar 22, 2:32pm 1646271128

The point is OP asked for examples of apartments that fit their criteria.

I found those examples

Whether or not you like those apartments is irrelevant.

OP: "Find me dog poop"

Me: "Here is dog poop"

You: "I don't like dog poop"

by Brock Landers | 3rd Mar 22, 3:03pm 1646273007

What he asked for was things that quote, will "get you on the ladder" for that price.

Apartments that leak don't qualify.

Apartments with dodgy leaseholds don't qualify.

Apartments with agent lies instead of real prices don't qualify.

The problem here is that you've come back with an assortment of findings that might contain some dog poop, potentially. But it's so mixed up with horse poop, chicken poop and human waste and god knows what else that it's really difficult to find that golden nugget.

by Kjeldorian | 3rd Mar 22, 3:13pm 1646273608

Am I saying all 362 are perfect, no.

Am I saying there will be at least 1 of those 362 that fit the criteria, yes.

by Brock Landers | 3rd Mar 22, 3:35pm 1646274914

It's possible.

by Kjeldorian | 3rd Mar 22, 3:41pm 1646275295

It's extremely unlikely.

Also, that is for one part of Auckland only. OP asked for any major city.

by realterms | 3rd Mar 22, 1:58pm 1646269083

It is telling how out-of-date TM's price categories are. You can distinguish between 100 and 150k but not 2.1 and 2.2m.

by al123 | 3rd Mar 22, 2:28pm 1646270889

It's not that it doesn't 'fit the narrative' - it's that the numbers on trademe of apartments under 450k in Auckland is not a very reliable guide to whether there are in fact any opportunities to get on the ladder in Auckland for under 450k. I ran your search and looked at the first three results - one was a leaker, one was a hotel unit and the other looked suspiciously good - and has a 2017 RV of 560k, so is extremely unlikely to sell for under 450k. The point being, you haven't actually shown that you've 'found x' by running a quick trademe search and just giving the number of listings generated.

It's like looking for flats - if you do a search for one-bedroom flats to rent, you'll find heaps that look pretty cheap. But if you dig into the listings, they're all bedrooms for rent, rather than one bedroom apartments. It's pretty annoying - there is a very big difference between renting a bedroom in a 6 bedroom house and sharing a bathroom and kitchen with 5 others and renting a one-bedroom place to yourself.

by Kjeldorian | 3rd Mar 22, 2:36pm 1646271368

So you think 0/362 fit the criteria?

by Nzdan | 3rd Mar 22, 8:38pm 1646293129

Okay, how many are leasehold with ground rent? Here's one that actually advertises the ground rent:

https://www.trademe.co.nz/a/property/residential/sale/auckland/auckland…;

Bidding will start at $400,000. Ground Rent $19,834.65 Body Corp $9426.9

Someone with an 80% LVR will have a $320k mortgage. The ground rent & body corp of $30k is like having an extra 9% tacked on to your mortgage rate.

by Kjeldorian | 4th Mar 22, 7:57am 1646333857

"find me anything in an nz major city that would get you on the ladder for that price."

Lets say 1% of the 362 in one area in Auckland fit this criteria. That means there is an equivalent apartment in NZ.

The fact you have found an apartment you don't like is irrelevant to the argument.

by Nzdan | 4th Mar 22, 8:21am 1646335292

"Let's say 1%" is just finger sucking a number to suit your point. I have found plenty of apartments that are leasehold, find me one that isn't.

by Nzdan | 3rd Mar 22, 8:41pm 1646293278

https://www.trademe.co.nz/a/property/residential/sale/auckland/auckland…

Important to note the ground rent for Princes Wharf is increased annually by 3% or the CPI (whichever is greater) and this is fixed until at least 2039. This is extremely positive as it removes all of the uncertainty with the previous five-yearly ground rent reviews that were in place.

by gnx | 3rd Mar 22, 9:49pm 1646297349

Have you checked out the concrete piles.... don’t know it will survive that long.... seriously

by Nzdan | 3rd Mar 22, 8:45pm 1646293530

https://www.trademe.co.nz/a/property/residential/sale/auckland/auckland…

$349k price

Opex (Body Corp): $4,182.25 per quarter
Ground Rent: $5,995.75 per quarter
Rates: $568.57 per quarter

A mortgage of $17k per year @ 80% LVR and $40k p.a. of extra holding costs. The equivalent outgoings of a $1 million mortgage @ 25 year.

by tomjones_04 | 3rd Mar 22, 2:16pm 1646270181

It’s a shame this website doesn’t have a cry baby filter. KJ pooping his pants again.

KJ… you know full well all those options are leasehold or ready for demo. Brocks narrative is always consistent. Never flowery or Emotional, but consistent.

by Kjeldorian | 3rd Mar 22, 2:40pm 1646271616

OP: "Find me X"

Me: "Here is X"

You: "POOPY PANTS"

by Kjeldorian | 4th Mar 22, 7:53am 1646333605

by tomjones_04 | 3rd Mar 22, 4:24pm

Puke83… we are all equal here. My opinion is just as important as yours and Brocks. Emotional outbursts are a sign of a lack of control. Not the most masculine display there dude

I agree with you.

by marcars | 3rd Mar 22, 11:45am 1646261135

You could pity those who bought at the top. However if you and partner were thirty somethings, had good jobs in Wellington and paying $650/week for a crappy central apartment and you receive a family donation for the deposit, it still makes sense to buy a nice house for $830,000. The contribution towards the 30 year mortgage expenses from saved rent is $1,014,000. So your pity may be misplaced really. You are always better off to buy?

Funny but rents aren't dropping...yet / any time soon.

by Reverse_hedge | 3rd Mar 22, 11:53am 1646261628

Rents have started to fall in Auckland and will continue to do so as more new builds are completed. And in real terms, rents are falling everywhere across the country.

by HouseMouse | 3rd Mar 22, 12:09pm 1646262577

Yep, if not fall then be flat.

Many of the shoeboxes coming on line are rentals.

Net migration is zilch and young kiwis will start leaving for Aus en masse.

There's just so many headwinds for 'investors'.

by northman46 | 3rd Mar 22, 12:42pm 1646264525

I had wondered about rent. I don't often track rentals, but on TradeMe Wellington has hovered around 800 listings since the new year. There's been no sign of new listings drying up. I would have thought the Jan/Feb migration would have ended by now.

I've also been following a disgusting rental that is still available after 6 weeks. Keeping an eye out for price reductions.

by Averageman | 3rd Mar 22, 2:36pm 1646271400

One tinsy winsy increase in OCR and promise of more to come. Add in a tightening of credit conditions and the FED announcing the shortening of its money supply. All underpinned by roaring inflation... everywhere.

Be quick indeed. To sell your specubox to another sucker. If you can find them. Its FONGO time. Kaaaarrkkkk.

by HouseMouse | 3rd Mar 22, 11:58am 1646261912

My big prediction for 2022...

The property spruikers here will start to fall away by mid year

by Miguel | 3rd Mar 22, 1:31pm 1646267499

If these sorts of trends are replicated in the REINZ HPI for February it’s going to make a lot of the predictions from RBNZ and bank economists look like they have underestimated the shift in the market

Keep in mind the RBNZ and bank economists predictions involved declines in the range of 4-10% and that price falls would happen gradually over a reasonably long time frame and in most cases starting mid/late 2022.

It again makes me think they underestimate the impacts of interest rate changes in a low interest rate environment (and I suspect they have failed to include what a shift in sentiment from FOMO to a “wait and see” mindset could have)

by chebbo | 3rd Mar 22, 2:27pm 1646270856

Ever see The Matrix? Remember when The Oracle tells Neo he's not "The One" - even knowing full well that he is - and later on clarifies her actions to Morpheus by saying that she told Neo "what he needed to hear"?

Well, Adrian Orr is kind of like The Oracle. He tells people what they think they need to hear in order for the RBNZ to be able to fulfil its mandates.

If Adrian Orr came out and told everyone that house prices were about to fall 40%, everyone would rush for the exits and it would become a self-fulfilling prophecy. If he wants to try and fulfil the RBNZ's mandate of financial stability, he'll talk about a soft landing instead, tell everyone that house prices will "correct" 10% or so over the next couple of years, and make sure that the house price forecast graph looks like it's trending back up again just before the forecast period cuts off.

He's not stupid. He's just telling people what he thinks they need to hear.

by tronic | 3rd Mar 22, 2:49pm 1646272168

That kind of talk could threaten my strong unwavering faith that the RBNZ predictions are accurate and likely to come to fruition.

by donny11 | 3rd Mar 22, 12:48pm 1646264900

Interesting. As noted by others current interest rates and expectations about interest rates seam to be a driver of this.

Another factor which I feel is overlooked is the high possibility that the next govt will be a "labour/greens" coalition. This will presumably bring with it some sort of tax on property.

by company of heroes | 3rd Mar 22, 1:16pm 1646266565

Yet Orr denied it was his OCR decisions caused housing price to go through the roof. Now they are trying to slow down OCR hike to save housing market despite having a mandate of keeping inflation low in this soaring inflation situation. Double standard much?

by streetwise | 3rd Mar 22, 1:01pm 1646265695

There's a great ocean out there and I don't mean the Pacific Ocean...I mean the vast suburbia of dubious neighbourhoods where house prices have been at ridiculous prices, where if you're outside washing the car kids walking past will yell 'honky' at you (this happened to me when I used to live in Clover Park).

Inotherwords, if your property is in a desirable location it will still hold its price, but properties (and cheaply-made apartments that have popped up everywhere) will be hit.

Location is everything.

by Fluffybunny | 3rd Mar 22, 2:21pm 1646270482

Well better they yell out honky, rather than camp if your front lawn and set fire to your kids playground...

by lucenera | 3rd Mar 22, 2:06pm 1646269575

The main reason why down is more sticky (and faster) than up: https://en.wikipedia.org/wiki/Loss_aversion

TL;DR:

If I am afraid of losing 100.000$ I am more motivated in my decisions than somebody that hopes to win 100.000$

by Averageman | 3rd Mar 22, 2:28pm 1646270887

Indeed. People will hang on for dear life sacrificing everything else that makes living worth while just for a few bucks of vapor capital gain. It aint a gain, till its settled and banked.The song that includes "know when to hold em, know when to fold em" is well named for these people.

by HouseMouse | 3rd Mar 22, 2:55pm 1646272533

It's going to be so much fun watching Ashley Church finding excuses for why his prediction of small house price gains in 2022 wasn't correct.

Or will he be man enough to admit his error?

by Kohukohunui | 3rd Mar 22, 5:51pm 1646283106

You'll never hear anything from him other than smug knowing verbiage describing how well he predicted whatever the current state might be.

by DDDDebt | 3rd Mar 22, 3:39pm 1646275196

Yikes!!

TTP... I think in your honour, NZ housing market commentators should now refer to the market as PTP

Past The Point of no return...

by HouseMouse | 3rd Mar 22, 3:59pm 1646276394

At least TTP can take the hits, CWBW and P8 are conspicuous by their absence...

by hum | 3rd Mar 22, 3:45pm 1646275544

Showing 30,139 results

CracK

by Odyssey | 3rd Mar 22, 4:01pm 1646276469

For first home buyers there is not right or wrong time to buy, In 5 years house prices will be higher than today.

by al123 | 3rd Mar 22, 4:23pm 1646277826

I hate it when people say this. It's just not true. Buying a house in November versus buying a house now could, depending on location, have meant forking out hundreds of thousands of dollars more for the exact same thing. Most people are not in position where spending 100k more than they needed to doesn't matter. That 100k represents lost opportunities - it could be put towards retirement, or have meant that you could have afforded to have another kid, or that one partner could stay home with a baby for longer. It doesn't matter if prices are higher in five years time than they were in November. That money is still gone, and the opportunities it represents with it.

The problem is of course it is extremely difficult to know when its the right or wrong time to buy. But that's not the same thing as saying that there is no right or wrong time to buy.

by Independent_Observer | 3rd Mar 22, 5:02pm 1646280127

How do you know that house prices will be higher in 5 years time than they are today? I think you mean 'using confirmation and recency bias, it is my assumption that house prices in 5 years time will be higher than they are today - although we've never been through a period of falling interest rates like this before over the past 4 decades, and with the risk of rising interest rates over the long term, there is a reasonable chance that asset prices could stagnate or fall for a significant period (years or decades)'

by DDDDebt | 3rd Mar 22, 7:25pm 1646288718

Timing is everything in markets.

You reduce your risk significantly by knowing when you have low downside risk.

In a falling market like we have now, it's when prices have clearly stabilised. Before that there is no upside risk.

If they really want to buy today, they need to go in with a hefty discount.

If FHBs were smart, they would go around on mass low balling everything. If they understood the collective power they had, they would harness their world of social media and do this on mass. There is a massive percentage of stock that only suits FHBs.

by Toye | 3rd Mar 22, 4:17pm 1646277423

rip CWBW

I don't think we'll hear from him or his basement boys again.

by HouseMouse | 3rd Mar 22, 6:55pm 1646286903

I reckon he's still teaching his boys a lesson down in the basement.

by tomjones_04 | 3rd Mar 22, 8:18pm 1646291932

Lol… pulp fiction style

by HouseMouse | 3rd Mar 22, 8:58pm 1646294288

That's the one....

by Mrs The Point | 3rd Mar 22, 11:50pm 1646304624

"Bring out the Gimp. The Gimp's sleeping."

https://www.youtube.com/watch?v=S8kPqAV_74M

by diy-guy | 3rd Mar 22, 7:46pm 1646289971

I realise this article is about Auckland, specifically Barfoots and I would agree with the sentiment that the market has turned ------- up in Auckland.

So much of NZ lags well behind Auckland both in terms of market shifts but also by price. Why is Auckland, say, $500,000 more than the same property / dwelling as chch?

My view is that Auckland inflated a lot, far more than most other cities (in $ terms). As such, it's probably got a lot more to fall than the rest of NZ.. which is likely going to have a smoother landing.

by IT GUY | 3rd Mar 22, 9:06pm 1646294777

Interesting opinion, regional NZ normally suffers more in recessions, but diary prices holding up, could be an urban hit this time?

by Oasis | 3rd Mar 22, 9:13pm 1646295231

I also wonder if these big cities have built TOO MANY houses. Seriously every time I’m in Auckland, I just cannot believe how many houses are getting built EVERYWHERE.

by lucenera | 3rd Mar 22, 10:50pm 1646301008

That is pretty much one of the first example of economic cycles I used to study at uni 2000 years ago.

Delayed goods are the most sensitive, because the time that passes between investment and delivery is enough to have the market changed in the meantime.

Scarcity => excess of demand => price up => production up => demand down => price down => abundance => production down => scarcity again

There is not TOO MANY, just there is a good chance for people to make money by offering something that is in high demand, until is no more.

I personally cheer for having as many houses as possible, without going too wild, but that is only a preference.

by Waikatohome | 4th Mar 22, 8:23am 1646335384

That was the thing I noticed in Ireland at the start of their crash. Too many houses - 5 bed executive homes in small groups built in the middle of nowhere. There were also For Sale boards on every street. I am already starting to see more around Franklin and North Waikato. My wife’s cousin lost $200k on a house in Northland a few decades ago, so crashes do happen in NZ. High reward seldom comes without an associated high risk.

by Carlos67 | 3rd Mar 22, 11:02pm 1646301766

The whole situation is now very complex and that was before the war got thrown into the mix. I can see an exodus from Auckland for a number of reasons. Auckland made the greatest price gains but it could face a disproportionate drop.

by lekkerbydiesee | 4th Mar 22, 9:36am 1646339790

down 9.5% in 3 months, assuming linear extrapolation (which it won't be, it may even accelerate downwards), that's -38% in a year. A badly needed correction correction in my view, but i do have empathy for those about to get .....!

by lucenera | 4th Mar 22, 10:14am 1646342046

yeah.. and instead of 200k deposit in Auckland you will need 140k. (but same or more mortgage repayment)

it will still be cutting out most of prospective FHB.

this is going to be entertaining to watch. I really do not have idea on how the govt will be able to argin this one (assuming they do/ want to).

Easy forseeable ones is complete removal of LVR, reinstate interest deducibility, etc... but is a pretty bad position to defend idelogically for a labour govt or coalition.

I hope they will leave this mess to the market, in the mid term it will just find another (temporary) balance.

by liltyke | 4th Mar 22, 12:04pm 1646348678

As a property valuer from a long way back, the signs are looking promising that this market correction (and that is all it is, nothing scary) will be -10% this year and probably less next year. Still no where near enough, because when you compare NZ to just about anywhere, our prices are massively over-inflated and have been manipulated by successive governments in order to keep the 65% property owners happy. It has made me feel physically sick watching the market over the last 3 or 4 years, knowing the long-term damage it has done to young people, whether they buy or not. Crazy rents being charged by mainly specuvestors, retired people forced to buy rentals because of near zero returns on term deposits, debt, debt and more debt for youngsters and not enough time to pay it off and save for retirement. Very, very sad