Residential auction activity slowed slightly in the first week of October

Property / news

Even allowing for the effect of school holidays last week's auction numbers were low

10th Oct 22, 1:27pm by Greg Ninness

Residential auction activity cooled slightly last week with fewer homes on offer and fewer selling under the hammer.

Interest.co.nz monitored the auctions of 174 residential properties last week (1-7 October), down from 184 the previous week.

Of those, 60 were sold under the hammer, giving an overall sales rate of 34%, down from 41% the previous week.

School holiday periods often result in reduced auction numbers with many vendors and potential buyers travelling away from home, but even allowing for that, current numbers are low considering we are now in mid-spring.

Canterbury was the bright spot last week with an overall sales rate of 70% compared to just 28% in Auckland.

Details of the individual properties offered at all of the auctions monitored by interest.co.nz and the results achieved, including the prices of those that sold, are available on our Residential Auction Results page.

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42 Comments

by King of the whiners | 10th Oct 22, 1:35pm 1665362125

I gather the auctions on the ghastly 'The Block' also encountered a degree of buyer resistance :) ...........

by nguturoa | 10th Oct 22, 1:44pm 1665362644

30% is still a big number of people who are willing to buy at auction and have cash ready to pay for the advertised price.

What could be so pressing reasons to buy at auction in this day and time?

by Averageman | 10th Oct 22, 1:44pm 1665362654

It's not that people dont want to buy, it's that they cant borrow the money. As Buffett was quoted "interest rises have the same effect on price that increasing gravity has on matter".

But wait for last years price it can only go up...tui.

by Caughtinthemiddle | 10th Oct 22, 1:59pm 1665363544

The Block has helped disseminate and consolidate the front line news that property values are declining. I think that we are at a point where we will see a much more uniform view of the NZ property market and this is only going to dampen appetite to buy if waiting is an option.

I see the Spring bounce as being a non event with further big decreases over the Summer break with a torrid Autumn and early Winter in store. I'll be bold and say I think we are half way down from peak. I suspect that the bottom will come in May / June ready for a potential change in Government and the economic data supporting a modest decline in OCR.

by Clementé | 10th Oct 22, 9:37pm 1665391025

Imagine if your house had weeks of in-depth marketing of an hour per night at prime time television time, where the biggest buyers with the biggest equity and lust in the housing market are the nightly viewers, with a celebrity host showing you through the finer detail of each and every room and you only sell for $4000 over reserve...

everything else is toast

by Zen20 | 10th Oct 22, 2:06pm 1665364016

I would suggest that paying north of a million for a questionably appointed 3 bed terrace on the outskirts of anodyne Orewa would be fairly risky.

by Caughtinthemiddle | 10th Oct 22, 2:13pm 1665364389

Zen,

Inherently risky or in the current environment?

by Zen20 | 10th Oct 22, 2:43pm 1665366216

current, but who knows - maybe long term too if it's a leaker

by bigtam | 10th Oct 22, 8:10pm 1665385809

NZD750,000 for a 450sm section in orewa😂😂😂

by Retired-Poppy | 10th Oct 22, 5:51pm 1665377507

Given the meteoric activity we have witnessed in recent years, it comes as little surprise that what we are witnessing is activity falling off a cliff. Owing to elevated interest rates, its likely this will continue for the forseeable future.

Not Tim↘️

by Carlos67 | 10th Oct 22, 2:51pm 1665366702

Pretty sure that most of the people on here that are going on about the bad property market are going to have bigger things to worry about next year. There is a good chance the wheels are really going to fall off just about everything come Q2-Q3 next year.

by Brock Landers | 10th Oct 22, 3:03pm 1665367417

Absolutely, given that Australia is going to be unhabitable in nine and a half years.

by Averageman | 11th Oct 22, 7:56am 1665428200

What’s the quote….80% of Australia is uninhabitable due to deserts, the remaining 20% is uninhabitable due to Australians...

by Ngrrk | 10th Oct 22, 4:18pm 1665371934

I found the majority of NZ uninhabitable because of Kiwis too if I'm honest.

by Averageman | 11th Oct 22, 2:25pm 1665451542

All those not enjoying being surrounded kiwis are free to relocate again elsewhere, especially if your cant see and enjoy a bit of NZ vs Aussie banter.

by Carlos67 | 10th Oct 22, 10:51pm 1665395478

Parts of it are already uninhabitable mate, when you cannot leave your house for hours in the middle of the day and have to have the aircon going full blast, that's uninhabitable in my book.

by Brock Landers | 10th Oct 22, 11:04pm 1665396272

You could always try growing a pair.

by Caughtinthemiddle | 10th Oct 22, 3:08pm 1665367729

Carlos,

Are you thinking unemployment and stagflation?

by Carlos67 | 10th Oct 22, 10:54pm 1665395666

Unemployment. The RBNZ will be forced to chase the FED and if the FED doesn't stop when we start waving the white flag we are screwed. The pain very quickly escalates with rates over 8% and lets not even think about double digits.

by lekkerbydiesee | 11th Oct 22, 3:04pm 1665453891

I'm pretty sure that fed won't even notice if we wave a 1000 white flags. Our entire country is the size a single medium sized US city. Why would they care about us? They won't

by HouseMouse | 10th Oct 22, 7:41pm 1665384066

That’s what I previously thought but I am less bearish now. There’s lots of slack in the system, the labour market seems structurally resilient.

In areas like construction, I think many foreign workers will return home once the slump hits, and there may not be too much in the way of increases in the unemployment rate.

I still see real weakness in 2023, but we might miss a technical recession, and unemployment might only be 4 to 4.5% by end of 2023.

by Carlos67 | 10th Oct 22, 10:47pm 1665395275

The "Employment" situation in this country literally changes overnight. So many small businesses with the owners raping it financially.

There is simply no financial stamina, one or two bad months and staff are getting layed off left right and center.

by IT GUY | 10th Oct 22, 3:10pm 1665367805

Its funny how the vested interests are trying to almost make out its just plateauing when its cleary crashing to anyone who has any clue about real estate prices..... and more supply is coming on at a time when very little is clearing.

by Averageman | 10th Oct 22, 3:24pm 1665368681

If you have had one way traffic for twenty plus years, and you have a big investment in a leveraged asset class, you have the blinkers on cannot believe that change could occur. That is an ASSumption, and can make one of you and me.

Popcorn.

by gingerninja | 10th Oct 22, 7:26pm 1665383196

Precisely Averageman. Outside of basic economics the way peoples mind generate thoughts to assuage unpleasant emotions is very well understood.

Behavioural economists have described much of the psychology of crashes, but it somehow remains hidden to those in the thick of it.

by Speedmax | 10th Oct 22, 11:02pm 1665396161

I would argue that until prices reach long term averages they are in fact correcting, since long term average is where they should be. Crash would be a significant fall in prices below long term average. So the correction has maybe another 30% to go

by Waikatohome | 10th Oct 22, 3:41pm 1665369692

I am enjoying Nikki Connors new Propeller Property Ad. Her advice is to buy a property 7 years ago and sell it today for a healthy capital gain. Why haven't you called us yet?..... Because the ship has already sailed.

by Averageman | 11th Oct 22, 7:55am 1665428120

To The Point, is she advocating bailing out and banking the capital gain before the erosion really gets going?

by gnx | 10th Oct 22, 4:13pm 1665371639

this from the property investors page on fb....god bless.

"Good morning everyone,

Just come across very sad story of my friend and thought it may be known upcoming problem… “interest rate pain”

My friend own few rental property roughly with loan portfolio of 3 mil of rental property.

One bank said he can only have interest only loan with their new rates of 7+ % on float, compared to what he had at 2.99%,

And no fixed rate offer for him.

Can bank force you to be on float ?

The other major bank offers 6.19 % with interest + Princpl and not interest only option.

Also with No interest deductibility.. and 10 yr bright lines leaves no room ….

I heard this and felt sorry for him…

Anyone else came across similar scenarios recently?"

The squeeze is coming on.

by Nzdan | 10th Oct 22, 4:51pm 1665373876

Hilarious. The entitlement mentality.

by gingerninja | 10th Oct 22, 7:42pm 1665384157

Entitlement yes, but the notion that you can’t lose with property is held with cult-like conviction by many. The mantras are still repeated about how their property values will be double in 10 years as they scoff at the price current decline.

Seemingly unaware that the whopping rising cost of debt is what will undo them.

by HouseMouse | 10th Oct 22, 7:45pm 1665384338

I bet more than 70-80% of the population have this cult-like conviction, Ginger.

by Slapheid | 10th Oct 22, 5:04pm 1665374693

I'm sure I have the world's smallest violin here somewhere.... now where did I leave the damn thing..... 🎻

by Caughtinthemiddle | 10th Oct 22, 5:09pm 1665374989

"The squeeze is coming"

No, the squeeze has been here for 6 months and has been widely telegraphed if you read something other than One Roof

by kiwimm | 10th Oct 22, 6:06pm 1665378381

The squeeze is getting squeezier

by Clementé | 10th Oct 22, 9:32pm 1665390723

The squeeze hasnt even started, this is the start of the bbq patter after the 4th beer and worry comes flooding out

by HouseMouse | 10th Oct 22, 7:44pm 1665384242

Diddums.

Three investor-owned properties have gone on the market in the last few weeks where we live. The owner occupied places seem stable.

by Rob Reid | 10th Oct 22, 8:54pm 1665388457

The part that says "and 10 yr bright lines leaves no room …" is revealing. The underlying thinking being, but if he sells one now to stay afloat he would be taxed on any gain - FUCK!

by HouseMouse | 10th Oct 22, 9:49pm 1665391777

Can’t lose any of that precious, precious capital gain!!!!

Desperately self entitled and greedy.

by Wrong John | 10th Oct 22, 6:02pm 1665378179

Not sure about the BoP numbers. I thought Eves had a relatively good week.

by Doggog | 11th Oct 22, 8:26am 1665429998

https://www.ftadviser.com/investments/2022/10/05/un-warns-central-banks…

The United Nations has warned central banks against further interest rate rises, saying more monetary tightening will increase inflation.

In a report released on Monday (October 3), the United Nations Conference on Trade and Development (UNCTAD) said the increase in interest rates, undertaken by many central banks to combat soaring inflation, poses an “additional risk” to the economy.

by IT GUY | 11th Oct 22, 2:07pm 1665450454

The issue is that our highly leveraged professional pension managers may fall over before our highly leveraged amatuer property investors... ie Bond Market carnage.... funny...