Auckland had its smallest number of new listings for an April since 2014 last month, but other regions - notably Canterbury, Wellington and Hawke's Bay, had strong gains in listing numbers.
Realestate.co.nz said it had 3380 new listings for Auckland in April, compared with 3544 for the same month a year ago - which is a 4.6% drop.
And while Easter, with its potential disruption to listing patterns, did fall during April this year (with Easter Sunday on April 1) it also fell in April last year - and right in the middle of April 2017.
The average asking price in Auckland also modestly reversed the year-on-year fall seen in March, with a 0.13 per cent increase to $963,504 (compared with $962,267 in April last year), but this was still well down on the record high of $994,175 set in February this year. In March the figure was $963,888, which was a drop of 0.6% on the figure for March last year.
The number of Auckland homes available on the Realestate.co.nz website at the end of April was 9294, down from 9572 as at the end of March.
The April total was still, however, a six-year high total for an April, up 4.1% from the 8927 figure as at April 2017. The March figure was also a six-year high for a March.
Elsewhere around the country, April was strong for listings, with the national total of 9899 new listings being up 1.9% on the same month a year ago. However, the overall figures were lifted by some particularly big rises in listings in some regions, while other regions fell and several were fairly static.
Realestate.co.nz said the national increase was the first time new property listings had risen year on year since November 2017.
"On the face of it this increase looks relatively modest, but it’s a case of several smaller regions offsetting a volume drop in Auckland," realestate.co.nz spokesperson Vanessa Taylor said.
"Typically, when Auckland gets cold, the rest of the country also suffers, but this time when it came to new property listings the rest of the country made up the numbers, led by Canterbury and Wellington."
The largest new listing contribution came from the Canterbury region with 1654 homes placed on the market in April, representing a whopping 30.4% increase compared with the same month last year.
The big increase in listings didn't come at the expense of asking prices. The average Canterbury asking price in April, at $506,700, was up nearly $14,000 on the previous month and rose 5.1% compared with April 2017.
The Wellington region recorded 754 new listings, which was a 13.6% increase on the April 2017 figures. The average asking price at $604,475, dropped by over $28,000 compared with the previous month, however, but was up some 7.5% compared with the price in April 2017.
Elsewhere in terms of listings, the Hawke’s Bay had a very significant lift in new listings in April, up 34% on April 2017 to 313, "and seemed to have broad-based appeal", said Taylor.
Otago, recorded a fall in new property listings to 282, down 4.7% on April 2017. Waikato, Bay of Plenty and Manawatu-Whanganui saw fairly static listings figures when compared with April last year.
Central Otago/Lakes new property listings were down 8% to 184.
Gisborne's new listings grew by 8.3% to 78 compared with April 2017, while Taylor said the the "favourite summer-time destinations" of Northland, Coromandel and Marlborough cooled in April. The number of new listings (compared to April 2017) and property asking prices (compared to March 2018) fell in all three of those regions.
Housing inventory
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77 Comments
stuff not selling in Awkland due to delta between sells and domestic buyers expectations. Wow that 3% was clearly BS. Before the usual bulls start quoting how great their post code is, that is greater Awkland. Could be a good time to buy an ex lease european car shortly.
What is most telling is the weeks of inventory figure. The number of new listings is probably impacted by the number of sales - whereas the weeks to sell is a measure of the inventory compared to activity.
What is most telling is that the 'weeks to sell' is twice the rate in April 2016.
What is also significant is the more headlines around the slow down, the more people are cautious about buying. Auckland real estate agents have maintained a message of stable prices, but when the reality of the ratio of properties becomes obvious you could see a very low appetite for purchase
Ex Socialist,
Definitely seeing deterioration of activity in the Auckland market.
From today compared to July 2017, on trademe.co.nz,
1) the number of Auckland listings tagged "urgent" have increased 33%.
2) the number of Auckland listings tagged "priced to sell" have increased 56%.
It's perfectly logical.
People are discouraged from listing their properties for sale when the market is relatively flat (which it currently is).
One might think of it as an automatic stabilisation mechanism which kicks in to hold house prices steady, preventing significant slipping.
Notably, since the last upswing ended (about 18 months ago) Auckland house prices have held pretty firm. The sizeable price falls that a number of people have prophesied over the last 3-4 years have simply not transpired.
TTP
You are right that there has not been the declines that many predicted - including myself.
However, what we are seeing is a slow change in the pattern - that people that need to sell are facing twice the competition. What will be critical is when the headlines become 'house prices fall' which will result in wider panic. Auckland prices were driven up buy expectations of further increases - and will fall on the basis of price expectations. They have to fall a long way until we seem the prices backed by fundamentals - such as rental income.
Personally I am not predicting 30% falls - but 10% by christmas isn't too extreme.
The big question is not so much the fall percentage but what the potential impacts will be on consumer confidence, jobs and political persuasion. The fuel tax increases are raising the niggle factor, now the Chantelles out there are going to be hit with 15% GST on overseas orders. A decent drop in house prices may be the killer blow to the COL. It’s the recession we need to have.
Every time I see a COL minister on TV the first words out of their mouth is to blame National for everything. What goes around comes around, it's politics. Nothing personal. The just announced plan to collect tax on anything under $400 is the best news all week as it impacts the mortgage belt most. It's going to be a long long Winter for Taxinda and the COL. The excitement is palpable.
I thought the national government already implemented a policy of collecting GST on all purchases from large overseas retailers?
I don’t mind them collecting GST as long as it’s efficient. Customs doing it for small purchases would cost more than the revenue raised.
Up until now the "don't have to sell" component of the market has been in the majority plus the banks have relaxed their lending criteria, which allowed for more FHB into the market. These 2 factors have been propping up the drop-off in demand, but as growing inventory indicates, they are losing the battle. The dam wall is showing cracks!
I don’t see how people can defer selling indefinitely. There must be a large percentage of the inventory that needs to sell. Especially since some of the sales achieved are conditional. I hear big chains of conditional sales can form only to collapse when the piece at the end fails to sell putting all the homes back on the market. Is there any reporting on the number of conditional sales to be settled?
I think the market has probably reached saturation point. That is, the price is at that the very top of the demand/supply curve. There just are not the people out there able to afford much more and, therefore, we have seen prices fall a little and the time it takes to sell a house extend. The logical response in this market is don't sell unless you have to.
Gummy bear - remind me, how much lending was on interest only terms in the Auckland market these last few years? If we are at the top of the curve and there are no more capital gains, how are those investments looking? (even worse if no longer able to offset losses)
The Man has got something to say.
Canterbury was bound to,have more listings as there have been plenty of new homes built and also a lot of small,investors are likely to be bailing out due to all the stupid changes that this COL are introducing.
Reality is that prices are extremely stable in Christchurch and very affordable.
Christchurch is going to be the city of choice in Australasia in the next few years!
Rp, haven’t sold any or don’t need to!
Have been spending mo eye on any of them, including new kitchens bathrooms on o es that we have bought in the past few years.
We haven’t bought in the last year as we haven’t seen anything we want that is grossly under market value, which is the way we like to buy.
You make money when you buy, and if it isn’t there then we don’t bother!
Sales outside of Rodney, for Auckland, continue to fall. Section sales are taking slack. Median prices down 8% off high. Another 17% minimum to fall. Landlords with mortgages on interest only will start selling due to low yield and revised upwards interest on loan renewals, in next 6 weeks. So, instead of buying they will be selling. that is 20% turnaround. Cost of credit will continue to rise this year and next, due to USA Fed increases and withdrawal of QE there and in China. China price gone for RE. Plus petrol price rising fast and government increasing taxes. All this crimps disposable income. So, inventory will continue to rise and Agents will press vendors to reduce price and they will. Prices go down historically , 2-3 years after sales. Immigration fall, GDP slips. Aussie banks to tighten credit criteria further, which Richard North in Australia anticipates will cut loans by 20% in next 2 years. Plus investors renting loans at higher rates peak in 2019-21. So, folks, it is all down hill for RE til next surge in 40-47 year olds (largely Asian) kicks in post 2023. Here endeth the news you will not get on TV or by commentariat.
Pragmatist,
If you want to understand the bull scenario for property prices in Auckland, here is the basis of the belief of continuing upward property prices ...
https://www.propertytalk.com/forum/showthread.php?17894-Financial-Armag…
A number of times, comments have been by property investors about property price gains over the last 50 years or more and then they extrapolate past price changes into the future ...
Many forget or are unaware of a fundamental rule to investing - that past performance is not a guide to future performance.
What is also noticeable is that Auckland property price bulls are focusing solely on underlying demand and supply in the property market, while being unaware of, or ignoring the credit factors and associated rise in risks and vulnerability of financially stretched households.
I recall asking an Auckland property price bull on this forum about their thoughts on the current credit factors and how they thought this impacted property prices, and they had no response. Not sure if they just ignored the question or didn't understand it.
I also asked a long time expert property analyst about property prices and the lens they looked through was that of underlying supply and demand in the property market, whilst being totally unaware of credit factors.
Yes indeed. Due to lack of economic understanding of RE sector in general. Plus even economists with sense are not trained (as in it is not in classical trading or degrees) on role of credit, liquidity and creation of money. Hence all blarney about less relevant factors like "strong fundamentals" which ignore cost of credit and non affordability. Have a look at Richard North, Aussie site called Digital Financial Analytics. Just publ a 6m survey update
Surely the fall in Auckland listings is reflective of a market that has removed the speculation,the flipping of properties for easy profit by a myriad of players and multiple favourable factors.Where Auckland housing stock could be turned over within 11 years it has fallen back to 25 years.,slowing,but properties are still being sold at this point in time
FYI guys, we just signed up with an Estate Agent to sell our UK house today. It's costing us 0.4%
including VAT, all marketing material, floor plan, energy performance certificate, premium online listings and unlimited 1-1 viewings (they don't like open homes in the UK really unless it's for a new build). No sale, no fee.
Seriously, what is up with the cost of Agents in NZ? It's not like there isn't competition, there are butt tonnes of agents and agency in NZ??
I really don't understand what justifies the prices charged in NZ? With so many agents in the market, so much competition and now diminishing sale volumes, why aren't market forces driving RE's prices down?
Why are they even so high in the first place? Most of the houses i've been interested in haven't even had floor plans even. And they don't take potential buyers around individually, they bunch them all up at an open home, which surely reduces the amount of time they actually spend actively on each sale? In the UK an agent takes you round and you can ask them detailed questions about the house as you go. But at the open homes i've been too, the agents just kind of stand there, apart from getting you to fill out a form, and then later spamming you with their self congratulatory news letters. A few have cooed a bit and made a few really transparent fluffing comments but not actual specialist knowledge that would be helpful. Not to suggest that UK agents are necessarily any better or worse, but you definitely get more for your money!
When I look at some RE agent incomes v's specialist physicians etc who go to university for many years, at great cost, it seems so very off.
I have the same confusion, agents don't seem to deliver more here than back in the UK. My house over there is still rented and the letting agents have a standing offer to sell it for me for 1% all in, I may have to negotiate further when the time comes.
One thing I have heard suggested is that estate agents over here spend more time on drumming up business than actually working on sales. Perhaps competition on price doesn't work as well over here as in the UK if the locals have a 'spend more to get more' assumption? My anecdotal feeling is that people over here spend less time and effort shopping around for better deals.
mfd
I also notice that NZ RE agents often use the sellers listing to get huge amounts of free advertising, much more so than in the UK. They plaster their faces over everything! Always makes me chuckle when i'm scrolling through the photos on a listing and suddenly i'm confronted with some cheesy picture of an overdressed RE. Actually, I don't always chuckle, sometimes I want to throw up in my mouth a little bit.
Last few times we sold in the UK, commission was 1% or under. Both properties sold in less than a month, the agents worked plenty hard to attract interest, they got us great prices and we weren't manipulated. Some RE agents try that in the UK, but I just won't work with the ones that do. I personally feel, if anything NZ agents seem to do less work. But i'm just going on n=1 so maybe others have a different experience. Nonetheless, the fees here are too high IMO
Yeah, I too don’t understand why real estate commissions here are so high. It’s nothing to do with superior service or product. But I don’t see any chance of it changing, agents would rather forgo the increased volume that would come from dropping the commission in the bad times in order to maintain their margins overall.
Not only are the RE agents' commissions unsustainable by rational basis,oftentimes the commission is multi-tiered and weighted more heavily towards the lower end.So much hot air in the spin about being highly-skilled and able to secure top-notch prices!!!
Open homes preferred to private viewings.Less legwork plus more opportunity to fish for new listings from amongst the viewers coming in.
Good real estate agents will make you more than you would get selling privately!
Poor agents will not get you a good result either!
Thing is that a lot of the top selling agents do not get you a great price, they are more concerned with selling it at all costs so that they are still up there as a top agent!
It is not hard to determine a good agent after interviewing them.
What!!!! I thought property prices were coming down according to a whole heap of keyboard experts on this website. Like I have said in earlier posts and from my experience in Sydney over many years, where demand outstrips supply prices kept moving up over a longer term. Anyone that didn't buy waiting for a drop got completely shut out.
Auckland low levels ofunemployment, lot of vacancies and a beautiful multi-cultural city attracting people, I don't see any major reductions longer term especially in Central suburbs.
Well said chessmaster, there are many keyboard experts on here all of whom I suspect are not actively involved in the property market and suffer from the old 'tall Poppy syndrome'. Madness is explained by - Trying to change the world around us to match our own misguided beliefs , Sanity explained by - changing our beliefs to the reality of the world around us ! Oh and don't mention property cycles they get real confused ! Happy Investing !
Ha-ha-ha :) Nice one Yvil!
Co-incidentally I went to an open home in Arney Rd last month, the RE told me it will be below $10mil and it sold for $10.87mil!! The new CV is $8.6mil and it's a whopping 26% over the CV!! https://www.barfoot.co.nz/750963
Hi Yvil,
Unfortunately, Ponsonby house prices have launched into the stratosphere. It's become an ultra-expensive suburb.
People are happy to pay a premium for the buzz factor associated with Ponsonby Road and all the cafes and designer shops.
The closer to Ponsonby Road, the higher the price.
It will have to be sometime in my next life, I'm afraid.
TTP )-;
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