Has the Auckland market reached its price limit?

Barfoot & Thompson managing director Peter Thompson

Barfoot & Thompson’s data for July shows that Auckland’s average sales price is at $827,359 - much the same as it has been for the past couple of months.

In June the average sales price was $826, 474.

Barfoot & Thompson managing director Peter Thompson said this meant July’s average sales price was within $1000 of that for June and only $5000 ahead of that for May.

“A stable average price over a three-month period is a trend we have not witnessed for some time.”

However, Auckland house sales activity was at its highest in more than 15 years during July. 

Barfoot & Thompson’s July sales figure was 4.5% higher than in July 2003 - which is the year previously considered the most active on record.
 
Thompson said the combination of high turnover and stable price pointed to buyer confidence in the strength of the market at current prices.

It is also recognition that property is fully priced.
 
He said the last three months of trading demonstrated hat high sales numbers could be sustained without prices increasing. 
 
“The first signs that price increases were slowing could be seen in last month’s sales figures, and this month’s results confirm that prices are no longer racing ahead.
 
“In fact, the median price in July at $757,000 is down $29,000 on that for June, but up $7000 on that for May.”
 
Over July, interest in property in the under-$500,000 category rallied, Thompson added.

“Sales numbers represented 14.4% of all sales, whereas in June sales of properties under $500,000 fell to 13.6% of sales.”

The agency’s total listings of 2802 at month’s end were at their lowest since December last year.

This means supply, and therefore buyer choice, will remain tight during August.