The spring surge in house sales is well underway in Auckland, according to the country's largest real estate agency.
Harcourts said it sold 576 homes in Auckland and Northland in September, a 22% increase on the 471 homes it sold in August and also up on the 558 homes it sold in September last year.
The average selling price of $683,101 in September was also well up on August's average price of $657,859 and the average of $617,444 in September last year.
New listings were up slightly at 671 compared with 651 in August, but down on the 711 new listings received in September last year.
However Harcourts has a lot more properties available for sale in Auckland and Northland than a year ago, with 1771 properties on hand in September compared with 1414 in September last year.
Harcourts chief executive Hayden Duncan said the company's sales staff were reporting an increase in the number of appraisals being carried out on behalf of prospective vendors and he expected to see an increase in new listings in the coming month.
Prices were likely to keep increasing into the foreseeable future as construction lagged population growth, so people thinking of entering the property market would be wise to do so sooner rather than later, he said.
Duncan said family homes priced around $400,000 were still available in many suburbs outside of central Auckland.
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45 Comments
What a self serving, despicable comment from Duncan. Notwithstanding there are many risks out there that make it a real potential prices will be a lot lower in a few years time than they are now, the amount of debt that should be taken on to finance it, etc.
The word slithering comes to mind.
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=113…
Damn - missed out on this opportunity yesterday :(
... it's wonderful being so far away from the auction , that we could see the earnestness and wide-eyed wonder of the participants ... lucky the ones who didn't succeed in procuring this little gem .... though they know it not , yet ...
You can easily realise that we're in a bubble when total rubbish 'like this property seems to be a good decision ....
... more tears will come than the thousands in the " house's " drapes and wallpaper ... Many more tears on the way for someone .. .. in the fullness of time ...
Latest QV Median House Value (01/10/14)
1 Herne Bay $1,894,400
2 St Marys Bay $1,592,400
3 Remuera $1,451,200
4 Stanley Point $1,434,800
5 Westmere $1,329,750
6 Campbells Bay $1,327,600
7 Epsom $1,318,650
8 Ponsonby $1,273,550
9 Devonport $1,259,600
10 Mission Bay $1,240,800
Here you go - work it out yourself:
1 Herne Bay $1,709,450 $1,894,400
2 St Marys Bay $1,493,700 $1,592,400
3 Remuera $1,240,000 $1,451,200
4 Stanley Point $1,252,750 $1,434,800
5 Westmere $1,225,350 $1,329,750
6 Campbells Bay $1,141,850 $1,327,600
7 Epsom $1,183,000 $1,318,650
8 Ponsonby $1,211,650 $1,273,550
9 Devonport $1,108,100 $1,259,600
10 Mission Bay $1,081,300 $1,240,800
11 Orakei $1,099,500 $1,240,750
Mate, you're running the QV "property spruiker" subscription there, email them to ask about the "actual data" subscription service. QV tells me;
Herne Bay $1,809,500 $1,894,400
St Marys Bay $1,525,750 $1,592,400
Remuera $1,318,400 $1,451,200
Stanley Point $1,279,700 $1,434,800
Westmere $1,281,250 $1,329,750
Campbell's Bay $1,221,150 $1,327,600
Epsom $1,282,100 $1,318,650
Ponsonby $1,199,050 $1,273,550
Devonport $1,130,400 $1,259,600
Mission Bay $1,117,300 $1,240,800
Orakei $1,159,450 $1,240,750
Anyway, I must have been looking at other suburbs on QV the other day because most of these suburbs have gone up by more than inflation (my mistake). Many suburbs are sitting on modest increases around inflation (Kingsland, Mt Eden, Sandringham, Mt Albert, Epsom). But clearly all is well at the top end of the market!
No disrespect doublegz but you appear to be cherry picking the best suburbs in Auckland. The suburbs you've selected are not a fair representation of Auckland's housing market.
REINZ medians over the last 6 months for the Auckland Region are:
- March 637K
- April 611K
- May 625K
- June 600K
- July 610K
- August 614K
The above figures show a 3.6% drop in the median value of properties in the Auckland Region over the last 6 months.
It's difficult to argue with the REINZ numbers. Median Auckland prices are flat at best.
"The median is being skewed by lower priced properties being sold in a frenzy."
What evidence do you have to support this statement nzcoolie?
I'm not suggesting the data we receive from REINZ is perfect but to the best of my knowledge it is the most reliable and the most up to date. To suggest we disregard the REINZ median numbers is a bold statement unless you have cogent evidence to support your argument. What evidence do you have?
You missed your calling Triple, you should have been a cherry picker. Every month you ignore the long term moving averages and compare the current months figures to the highest blip you can find (March 2014). Why don't you share this months median in comparison to January's median? Or why don't you share the difference between January's median and March's median?
No one is fooled. Prices are up another 10%+ yoy and forecast to keep increasing strongly.
I am not interested in fooling anyone Happy123. I seek the truth - not media spin.
I have hardly cherry picked - I've quoted the REINZ Auckland Region median every month for the last 6 months. How is that cherry picking?
I never said the numbers were not up yoy - i said the medians in Auckland have been flat for quite some time. As far as i am concerned 6 months is "quite some time".
If buyers want to base their financial decisions on data from 12 months ago then that is up to them. However, i and i believe many other potential buyers, are more interested in what is happening currently. I think the last 6 months provides a fair indication of that.
Here's a question Happy123 - applying the median house values in the Auckland Region, can you please tell me what the capital gains have been over the last 6 months?
Hi nzcoolie. I try to keep an eye on the B&T auction numbers each week and yes i too have noticed what seems like many sales at the more affordable end of the market. Oddly we have been told that LVR rules would stop buyers in this exact price bracket. Maybe it's investors who are buying, or perhaps the lenders have relaxed their lending criteria, i honestly don't know.
However, what i do know is when i try to differentiate between the hype and facts, the most reliable source of information I've found are the REINZ medians. And these numbers are currently showing a flat market in the Auckland Region over the last 6 months.
I realise this may change over the next few months - and if it does then we'll all know soon enough.
.....give me a break coolie.
My wife is a property manager not a real estate agent. She manages over 100 properties in the Eastern Bay area where rents have barely increased - according to her. In fact in some cases they have dropped. However apparently other people have experienced rent rises in different areas.
I only say what i see, and the fact is auctions are running at around 40-50% success under the hammer this year, whereas they were running at around 80% success last year. That's a big change. Plus you're now seeing many more sales with prices listed - why is that coolie? Why is it the B&T auction room on Wednesday this week was only about 1/4 full?
Even when i last spoke with the bankers in private banking they said numbers have slowed this year.
People i know who are doing new builds say things are still selling but taking much longer.
And according to the REINZ numbers, medians have not increased over the last 6 months in Auckland.
However i suggest you continue to buy if you think the market still has legs. And if foreign money starts poring in again then you'll propbably be right. Personally i think Kiwis are tapped out - i dont think they can borrow/service more, so if prices are to go up further it will have to be foreign money doing it.
It all depends on how you look at it.
One way to look at housing is that it is determined by location -all other things being equal (no beaches, lakes and so on) central is the preferred location because that gives you the most amentities for the shortest travel. The next factor is that people will compare housing with the 'next cheapest alternative' so slightly further away from central. So typically cities have a land rent/price curve that is highest at the centre and lowest on the periphery. The price in the centre will depend in part on the price at the periphery.
If you restrict new supply, especially on the periphery then the curve will be higher and steeper to the centre. Price rises from demand shocks will be greatest in the centre and will gradually radiate outwards.
Of course for some if the land/rent curve is too high and steep there is no house they can afford. Then there next cheapest alternative is living in rentals which often has the problem of not being permanent affecting things like your kids schooling, living with relatives possibly in an overcrowded unhealthy situation, living somewhere not designed for living like a garage or a car or being homeless on the streets.
More and more kiwis are resorting to these options......
Brendon...I hope you read the article by John Bolton on interest.co.nz.........there are some really good comments....one by iconoclast...."55% costs before a sod is turned"........and Dale Smith put a very good perspective forward of which he discusses the canary affect on developers......
The issues you raised above come down to supply and demand......and these planners in Councils need to be held accountable for restricting supply.
I did read alll of that and it was enlightening. We are way past time for all the players involved to use their common sense and cooperate to sort this situation out. Starting with the planners. But central government needs to do there bit too. Interestingly CCC acknowledged that restricting supply had caused house prices to rise. So there seems like there is a basis of understanding for cooperative reforms from some local governments.
If CCC is admitting that they restricted land supply and that has caused prices to rise.....then there are a couple of serious legal implication that could arise.....
Home owners who couldn't afford to buy could in effect sue the Council.
Home owners who have paid to much could also sue the Council.
It seems to me that the Councils have given no consideration to any of the documents that make up the constitutional arrangement in NZ.......which I have previously whinged on about.
If court action is to be taken and the Councils are found guilty then all ratepayers could find themselves on the hook with rate increases to cover the costs Councils incurr....
There is very little difference between the issues in the Treaty of Waitangi settlements and the land supply restriction policies of Councils.........
http://i.stuff.co.nz/the-press/news/10595493/Planning-costs-linked-to-p…
i think this is an admission that CCC have a responsibility to work with others to ensure affordable housing. You are drawing a long bow to say they have sole legal responsibility and could therefore be sued.
I only ever refer to the Auckland market, it's a completely different beast to the rest of the country. The reason your making bad investment decisions is because your analysis is flawed; you allow the swings to distract you from the short, medium and long term moving averages which are all trending up, strongly.
As for the future... there are 1m extra people forecast to squeeze into Auckland over the next 20 years, if you think prices are going to drop you need to go back to econ 101 and look up supply and demand.
As for your question... you're cherry picking again, I could just as easily say "tell me what the capital gains were from January 2014 - March 2014?" Or the June to August quarter which dispite the election and winter slow down showed strong increases. Properties arn't traded month to month is a long game.
.... so Happy123 you can't tell me of these capital gains for the Auckland Region over the last 6 months can you???
Answer: BECAUSE THERE HASN"T BEEN ANY!!!
BTW, it's a little arrogant stating i'm making "bad investment decisions" when you have absolutely no idea what investment decisions I've made. How about you stop playing the man and start playing the ball.
Now answer the question Happy123: What capital gains have there been in the Auckland Region median house prices over the last 6 months?
No need to shout, if you think that people are buying houses in March to sell 6 months later then I can't help you. If you don't understand fluctuations in statistics and long term moving averages, I can't help you. I have already shown how misleading your cherry picking is but you persist with it and it will lead to bad investment decisions.
I guess you've sold your Auckland investments and now you're secretely gutted that you sold out too soon, better luck next time.
haha... you're so arrogant Happy123, you make me laugh :-)
...actually you remind me a lot of some property developers i used to know. Unfortunately they're all broke now.
So you have no proof of any capital gains over the last 6 months for median house prices within the Auckland Region.
Perhaps we should all just accept your word and forget the REINZ numbers....
Long story short Happy123, we get media articles every week screaming record prices but by the best measure (REINZ medians) this is simply not true.
There is only so far a bubble can be 'talked up' and were past that point, the income multiples are too high (rich cash buyers notwithstanding).
Most months I let it go but I think it’s important to call you perma-bears on your BS every now and then. For years now I’ve watched you and your ilk claim there is going to be a drop in Auckland prices; whilst the reality is the total opposite. I just feel sorry for the people who believe you and end up making terrible life decisions.
The median multiple is an antiquated measure and assumes everyone starts from $0 which is not the reality.
You argue with me because you don't like what I say but if you spent more time listening and learning you might learn why today's housing market is not the same as yester years. Or you can go on scratching your head in wonder.
Nice strawman there with the 'perma-bear' - I don't recall predicting a crash. I maintain prices in real terms cannot and will not go materially higher. They still haven't passed the last peak in real terms. What you forget is that housing is more than a economic issue it is a political issue (including the RBNZ as well as politicians).
I feel sorry for people who buy into the "property always goes up" myth and sign up for a life of debt. Graeme Wheeler stated when introducing LVR rules that part of the intention was to keep first home buyers from taking on too much debt - I guess he is helping them make "terrible life decisions". My comments are an opinion not investment advice.
I note that you don't respond with any facts or numbers, you're argument usually consists of a cocktail of fear mongering and condescending insults. And likewise, you don't like what I say which is why you respond the way you do.
There is one cold hard fact that you perma-bears can't avoid... I have been getting it right for years now.... and past performance is a good indicator of future performance.
"housing is more than a economic issue it is a political issue" - very true, and tell me, which party won the election... And are highly likely to stay in power until 2020....
Property values will continue to rise in Auckland in both the short and long term.
If there is one investment truism it is that "past performance is not an indicator of future returns" - in fact managed funds in many jurisdictions are required to remind their clients of this in their prospectus.
I would highly recommend you pick up a few of Nassim Taleb's books and take a look.
Up or down I am sure but a good friend had an offer on their family home in Central Auckland suburb in September last year, they turned it down flatty. This year they put it for auction again, they had some biddings and some offers after the auction, none were anywhere near what they had last year.
Cheer up about ebola. It is a poverty problem - and not the New Zealand kind of "poverty". Once these chaps have access to clean water and electricity it will be a thing of the past.
http://blogs.telegraph.co.uk/news/tomchiversscience/100281820/the-curse…
I think the official excuses to justify the constant-dangerous-financial-and-productive system threatening housing price increase is a big lie.
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The real estate bubble kept growing even when the immigration was flat. So the immigration is not the big factor here. MOST of the immigrants that are accounted in population increase are not people who will settle down in NZ but people who come for a while and leave. Mostly tenants like myself
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There is not a lack of supply. There is lack of supply at affordable prices (3-4 times the household anual income) created by an irrational demand.
- There is not such a thing as evil foreign speculators. The speculations is here at home conducted by our beloved relatives, friends and neighbours. Everybody who believes that it's justified to take on big mortgages because tomorrow the price would be more expensive hence it is a "good investment" is a speculator. The difference is that some of them are also fools because they don't buy with the intention of making profit but with the classic intention of owning a property and live there despite the price.
From my point of view there is absolutely no reason for this crazy price increases other than a cheap credit, a society that encourages property over rational usage of resources and a growing pyramid schema in which the ones on the top take advantage of the fools that join the bottom.
This is a dangerous and risky bet. It's easy to know what will happen, the difficult part is to know when. But it's not far away by the look of the diminishing returns in the productive economy and by the fact that the economy growth is not based on productivity but on consumption (because there are more people, not because we are richer) and on DEBT (debt that will become unsustainable as soon as the dimishing returns are not enough to repay it in the future)
PS: I just feel disgusted of the common advice to "buy whichever shitty house now and in the future get something better". Pyramid scheme it's the most accurate term.
Have you, young people like me, ever considered refusing to join this madness? You should.
As I watch the deluge of property data being disgorged every month on interest.co.nz, generating talking points for the following week, followed by interpretations and analysis by talking heads .. as I watch this passing parade I become confused by the different terminology like, average, mean, median, all of which in turn produces comments requiring explanation of what they mean, together with the implications flowing from those .. one data set comes out trumpeting house price rises .. another data set comes out saying house prices flatlining, while another data set comes out showing that house prices have eased.
Yet 7,000 houses sold in the month (of July) are not that same 7,000 houses sold in the previous month, and they are not the same 7,000 houses that were sold in the same month the previous year
Meanwhile, sold in the past week
House in Mt Roskill Land Value Only $1,125,000 land area 868 square metres
House in Mt Albert Land value only $1,025,000 land area 749 square metres
http://www.interest.co.nz/property/72386/changing-face-aucklands-million-dollar-plus-homes
House in Grey Lynn Land Value only $1,075,000 land area 381 square metres
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11339278
Each one of those "properties" are well above the Auckland median, are land values only, do not include any value for the house yet will be counted in all the stats and press releases as "houses sold"
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