There was a plenty to choose from at the main Auckland apartment auctions this week, but as has been the norm lately, results were very mixed.
City Sales had six apartments on offer, including a one bedroom unit in the landmark George Courts building on Karangahape Rd, a leasehold unit in the Lighter Quay complex at Viaduct Harbour, several others dotted around the CBD and one out at Mt Wellington.
Four of the apartments received multiple bids but the George Courts unit was the only one to sell under the hammer and the other five were passed in for sale by negotiation, two of them without receiving any bids.
At Barfoot & Thompson's main apartment auction this week, six apartments and two commercial units were offered (a seventh apartment scheduled to be auctioned was postponed), with three apartments selling under the hammer and three being passed in for sale by negotiation.
The mostly hotly contested property was a 98 square metre apartment in the art-deco Eden Hall building on Eden Crescent, just around the corner form the High Court.
It had its own single garage at street level and there were several keen bidders for it, and it sold for $960,000.
There was also good bidding on a unit in the popular Grand Chancellor building on Hobson St which sold for $633,000.
At Ray White City Apartments a bumper crop of nine apartments were on offer, with seven selling under the hammer and two being passed in for sale by negotiation.
Three of the apartments on offer were in leasehold buildings, with one selling for $112,000 and another for $135,000, the third being passed in with no bids.
There were also a couple of apartments under hotel lease in the Spencer on Byron building in Takapuna, both of which sold.
The hottest bidding was for a 116 square metre unit in the H47 building on Hobson St in the CBD.
It had two bedrooms, two bathrooms, two car parks, a balcony and harbour views and sold under the hammer for $1,007,000.
The full results from all three auctions, with the prices of all properties that sold and details of those that didn't, are available on our Auction Results page.
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68 Comments
Well it was the Auckland local Investors that pushed up the outer Auckland area's prices when the Investor LVR restrictions came in to effect in 2015. So I think they're selling up as we also know that any future Government will need to further curtail property investors. I only hope that they recognise Foreign Investors in that equation.
Very good - thanks for that CJ.
And I agree with your response to 'the Boy', as you call him, further down the page. I have children who are wanting/needing to buy in Auckland for employment reasons (both gainfully employed) and I too advise them to WAIT. So that's the reason I track certain property types; nothing to do jealousy or envy but just to see what the market is doing. I suppose you could say I am being productive on their behalf..!
Where is Ted to spout forth that plane loads of foreign investors are right now landing at Auckland Airport, to jump into a Japanese import mini bus and endlessly drive round neighbourhoods and snap up properties without even going inside them !!
I am really interested in the press releases aka "advertorials" that the RE agents will write for the coming March figures ...what "spin" will they put on it this time ...... just a "mere blip" springs to mind.....gotta keep the "greater fool" ponzi scheme going ....
@ The Boy; We are being productive in tracking the downward trend of the market and making sure that FTB's get a 'fair deal'!
Message to all First Time Buyers; WAIT for the market to bottom out! Give it a few more months at least until prices become affordable and don't get ripped off at an auction.
If fact avoid property auctions at all costs as they are very much geared in the favor of the RE's to squeeze every penny out of you. :)
I can be difficult to tell when the market has bottomed out. But with the increased number of property listing far exceeding the number of sales = very much a Buyers market at the moment. The old supply and demand.
Based off average salary for Auckland which is realistically around $65k if you consider a couple with children (Where one partner will probably be working part-time). So house hold income will be around $97 to $100 before tax. If they have a $50k deposit then they can probably borrow around $400 to $500k. Though this greatly depends on many factors including the number of children.
Humm... bargains; I'd be very weary of Leaky Home sales, Morgagee and Ex-rental properties. Make sure you get a builders and a substance report to check for 'P' lab exposure (Substance report especially for ex-rentals).
CJ, going by your figures there are going to be a lot of first home buyers on the sidelines for along time, or they will be buying in South Auckland.
Regarding auction bargains, I am not talking Auckland, and as for ex rentals with P, never been a problem for me so far, but haven't really bought ex rentals, as rental returns for most owners in Christchurch are positively geared!
keep pumping it, but you won't convince me it aint all over. Clear any debt, batton down the hatches, spread whatever you have far and wide............then sit and hope. The head winds are building by the day. More fool are you if you don't caste an eye...
Beer time. Have a good one.
Typically the best time to buy is 4 years post the previous peak. So if the top was Oct 2016, unless purchasing in a forced sale scenario, history would say hold fire until 2020. Rent a nice place in a great location, increase your savings and enjoy life. If you have to move for a new job opportunity give the landlord notice, better than trying to sell in a flat market.
Brilliant. I'll keep working and saving $100 a week and paying stupidly high rents and in 15 years I might have enough for a house deposit. A property investor with multiple properties tells renters and prospective FHBs to be productive. The irony and cluelessness is unreal.
Shhhh all you nasty people are going to make the housing market crash. Just hold your nose and buy even if you have to use all of your savings and extra from mum n dad for a deposit. The mortgage will only be 50% of your take home pay and don't even worry about interest rates rising either. After all housing never drops according to my bank manager.
Where's DGZ & Zach to comment on this? Not exactly on the outer rim of Auckland anymore.
http://www.realestate.co.nz/2949065
I'm here I'm here, but not sure where Zach is... It's been a really busy week at work and I have been well & truly swamped this past week. I'm really just here to report on a couple of sales in the last couple of days on the properties that I have been viewing at the open homes.
1) 6 Lee Street, Parnell sold for $2.475m under the hammer (70% over CV).
Note that the land is only around 300sqm, house around 150sqm. https://www.barfoot.co.nz/589397
2) 30 Norana Avenue, Remuera sold unconditionally this week for around $3.2m (60% over CV).
http://www.remuerarealestateregister.co.nz/catalog/product/1178
Both in DGZ ;-) Zach, please give us your insight on the sales.
Also, the above property you mentioned (134 Manukau Road Epsom) is on a really busy street but it comes with the consent to demolish so it will push the price up. It has a CV of $1.5m and in DGZ. I am guessing it will go for around $2.25m instead of the asking price of $2.8m.
Phew, just got back from a twelve hour, hard slog day. We JAFAs work like Trojans. I'll check out the properties and edit this comment.
I too think the Manukau Road property seems highly priced although it is commercial I guess so out of the area of our expertise. Dropping the price 250K from an unreasonably high asking price doesn't mean anything.
So who dares to make a punt at predictions?
For instance;
Where will be hit hardest if the market does tank? Auckland, Outer Auckland, Christchurch, Wellington?
Will the market just soften and stall or will there be a real drop?
Are there any bulls out there who thinks the boom has longer to go?
Anyone with skin in the game who has actually taken action based on the current information either way?
My bet is an over all -20% if the markets reduction continues at the pace it's currently headed in. Possibly for Auckland too, though that entirely depends on how much damage Trump inflicts on China through trade tariffs.
I'm still not convinced that its only local Investors that are responsibly for Auckland's massive property price increases in recent years. If it was Local Property Investors then this sudden sales and price decline would have happened back in 2015 when the 40% LVR restrictions were introduced for Local Investors.
Strange how it's suddenly happened in the last few months, since late 2016 when Trump started to threaten China with hefty trade tariffs causing them to enforce their Capital Flight restrictions as much as possible on their people.
Most of Auckland's foreign property Investors (Non Resident Investors) have flown the coop, so not surprising that Auckland's property market is now declining.
If anyone else can offer a better logical explanation as to why the market is declining, then I’d love to hear it. :)
I think there are a combination of headwinds creating a perfect storm.
Banks tightening, foreign investment caps, global uncertainty, LVR restrictions. I think psychology is another factor. Simply put, the longer the boom goes on, the more people start to worry about the bubble popping. The fact that the housing inflation is causing inequality and socioeconomic problems for future generations is a common discussion, the words "BOOM" and "HOUSING CRISIS" are constantly in the media. And it should be. But it raises fear. Fear and panic kill markets.
Outer Auckland will be hit hardest, then Auckland, followed by Christchurch. Wellington should fare best, highest average wage in the country, and likely to be more positions in the public service post election. Pet projects of coalition partners, and if a Labour government the public service sector will expand significantly.
I have sold 50% of portfolio, predominantly the Kapiti Coast north of Wellington, as still want to have a position in the property market. I would anticipate a 20% fall in the Auckland median, 10% off the national median. Probable 10% fall for the Wellington region. From experience double the decline in the median price and this is the discount you can expect in a forced sale situation in a stagnant market.
I have noticed, DGZ also gives two examples above, that some houses, usually nicely presented ones in the prime areas, are selling for way above the homes.co.nz high prediction.
My feeling is that there will be quite a bit of developing of old houses and rebuilds in these areas. Epsom, Remuera, Parnell etc will continue to edge up in price.
Thanks Zach, you speak my mind. That's exactly what I have been thinking :-)
I'm quietly excited about the following DGZ listings around my neck of wood, and here are my thoughts:
1) 43 Orakei Rd (https://www.barfoot.co.nz/589879) - A classic arts & crafts masterpiece and will be sold at auction or within 48 hours after auction!
2) 33 Benson Rd (http://www.uprealestate.co.nz/UPR14173) - Can't see this in the market for long coz it screams high-end & quality!
3) 24 Komaru St (https://www.barfoot.co.nz/591910) - A family heaven and this location is hard to beat, close to everything and will be snapped up!
4) 16 Combes Rd (https://www.bayleys.co.nz/Listing/Auckland/Auckland/Remuera/1751084) - Will be a very popular purchase considering the premium location and land size!
5) 42 Bassett Rd (https://www.bayleys.co.nz/Listing/Auckland/Auckland/Remuera/1751085) - Who doesn't know Bassett Rd? This will be gone in no time!
Will report on their progress on in the next month or so ;-)
DGZ and I are looking at where you could possibly continue to make money in the current market conditions. I know a lot of readers think this is morally wrong but this website is supposed to be focused on financial decisions rather than social activism. The advertisers, you know the people that fund this site, appear to be mostly property related.
Zach is right, yet again!
Every listing and every sale in the Auckland property market will have a direct influence on the property trend that we are seeing week in week out. The examples I have given above are highly relevant and will accurately reflect what is happening out there in the real world, not just all the social activism talk we are seeing here online.
I feel strangely calm. I don't think people particularly fear losing some capital gain - there are a lot worse things to fear, it's more of a two steps forwards one step back sort of thing. I was thinking of selling one property but the tenant's contract in Auckland has been extended and I don't want to disrupt their life. Two thirds of my mortgages have been renewed and I am now almost a grand a month better off. I also have this feeling that some properties are going to keep edging up.
I am also amazingly calm. We are here for the long haul and we all know there is only one direction it will go in the long run and that is UP. The increase in listings only means that there are more free open homes to attend in the weekend and more choices for buyers. It is a good balance in the market in my opinion, both vendors and buyers appear happy with the current climate. This is a good thing and we should all be grateful!
Gordon, sorry for the late reply but I fell asleep at my keyboard due to exhaustion. I have generally run fairly negatively geared with about a third of my wife's salary going to pay the mortgage. I thought if I sold one property I would be positively geared. I must have read too many THE MAN 2 comments and was impressed with his advocacy of positive gearing. Now with lower interest rates I am practically neutrally geared for the time being. I was also thinking that it would be good to diversify a bit, maybe after reading your comments. You see I do read people's comments and think about them.
Fact or Fiction...Funny Munny...No Joke. Seriously Folks....whatever next?.
Zackly The Man must be king...or the Emperor has no clothes?
Leverage has two direct possibilities. What a joke?.
Have fun..reading this Friday?.
http://www.zerohedge.com/news/2017-03-16/what%E2%80%99s-next-global-rea…
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