Property

Auckland house sales take a big hit

Figures from Auckland’s biggest real estate agency show the housing market is slowing down quickly. Barfoot and Thompson, which accounts for 35% of the Auckland market, says house sales in January are down 2.4% compared to the previous month. However, on a 12-month basis sales are down a massive 41.5%.

Sunday, February 10th 2008

Average prices in January are down 7.5% on a monthly basis to $517,613, however over the year they are up 8.9%.

An indication the market is deflating is the sharply rising stock of unsold homes.

Barfoot & Thompson says it ended the month with 6,173 listings on its books. Director Peter Thompson says that’s a higher than normal figure, but says it shows “there are plenty of willing vendors in the market but that they will need to be realistic about price expectations.”

Sharebroking firm Goldman Sachs JB Were says; “This suggests the market is failing to clear at recent high prices and that low net migration and very high mortgage rates are hampering demand,”

Given very soft demand for residential property and a lack of valuation support, the pressure on prices is to the downside over the year ahead. Given high household exposure to housing (86% of assets) and high gearing (170% of income), a deepening downturn in the housing market could have far reaching economic implications.

Barfoot and Thompson director Peter Thompson acknowledges there was a cooling in the market for the first month of the year, over and above the normal seasonal slow down, but he believes it will be another month or two before a clear picture emerges.

“It’s too early to make predictions about the state of the property market for the remainder of 2008, although we should have a clearer idea by the end of February where the market is likely to sit. Indications to date are that February is also slow, but we have to take into account the fact that school holidays have lasted a week longer than usual.”

While sales are slow there is good news for investors on the rental front. Barfoot & Thompson says January saw a sharp increase in average weekly rent from a 2007 average of $370 to $396 in January.

“This is the highest average weekly rent on record – the next highest month was October 2007 when the average was $388.”

READ MORE

 

Heartland Bank - Online 6.69
SBS FirstHome Combo 6.74
Wairarapa Building Society 6.95
Unity 6.99
Co-operative Bank - First Home Special 7.04
ICBC 7.05
China Construction Bank 7.09
BNZ - Classic 7.24
ASB Bank 7.24
ANZ Special 7.24
TSB Special 7.24
Unity First Home Buyer special 6.45
Heartland Bank - Online 6.45
China Construction Bank 6.75
TSB Special 6.75
ICBC 6.75
ANZ Special 6.79
ASB Bank 6.79
AIA - Go Home Loans 6.79
Kiwibank Special 6.79
BNZ - Classic 6.79
Unity 6.79
Westpac Special 6.39
China Construction Bank 6.40
ICBC 6.49
SBS Bank Special 6.55
Kiwibank Special 6.55
BNZ - Classic 6.55
Co-operative Bank - Owner Occ 6.55
ASB Bank 6.55
AIA - Go Home Loans 6.55
TSB Special 6.59
Kainga Ora 6.99
SBS FirstHome Combo 6.19
AIA - Back My Build 6.19
ANZ Blueprint to Build 7.39
Credit Union Auckland 7.70
ICBC 7.85
Heartland Bank - Online 7.99
Pepper Money Essential 8.29
Co-operative Bank - Owner Occ 8.40
Co-operative Bank - Standard 8.40
First Credit Union Standard 8.50
Kiwibank 8.50

More Stories

Support for regulation

Monday, March 18th 2024

Support for regulation

REINZ has emphasised the need for property management regulation to Parliament’s Social Services and Community Committee.

A better investment market

Thursday, March 14th 2024

A better investment market

“Reinstatement of interest deductibility starting from the new tax year on 1 April brings property investors back in line with every other business in the country, where interest costs are a legitimate deductible expense," Tim Horsbrugh, New Zealand Property Investors Federation (NZPIF) executive committee member says.

[OPINION] Recessionary times

Thursday, March 14th 2024

[OPINION] Recessionary times

It is not the best out there for many businesses and property sector people. Sales are down across the board, our clients’ confidence is falling, and there is a lot of uncertainty.

Interest rate expectations: It’s not over yet

Thursday, March 07th 2024

Interest rate expectations: It’s not over yet

Most Kiwis think interest rate increases have peaked.