House Prices

Auckland market crushed but not shut down

For the second month in a row Barfoot & Thompson's average selling price has fallen.

Friday, October 08th 2021

Average sales prices for houses sold by Barfoot & Thompson last month fell by 4.2% or about $50,000 to $1.132 million on August’s prices but was 13.6% higher than September last year.

The median price at $1.1 million was a 2.7% drop, down $30,000 from the August peak, but 18.3% higher than in September last year.

Barfoot & Thompson managing director Peter Thompson says the drop in average and median price had more to do with apartment sales and the price categories in which sales occurred than buyer resistance to market prices.

“In September, 23.1% of all the homes and apartments sold were settled for under $750,000 compared to only 18.9% in July – the last month of trading not affected by the latest Covid lockdown restrictions.

“This anomaly, combined with the artificially low number of sales in the month, had a marked influence on the average and median prices.”

Online technology gave the Auckland property market limited ability to operate in September and, although sales activity was severely curbed, it coped more effectively than during last year’s Covid lockdown.

“The restrictions and restraints on open homes and viewings had a major impact on sales volumes and trading patterns, and these in turn resulted in both the median and average sales prices edging lower,” says Thompson.

“The public is now far more accepting of the use of online technology and services such as virtual viewing, and this is helping the market to continue to operate in an environment where lockdowns are likely to be common for some time yet.

“Lockdown is having a major impact on those involved in the real estate profession, including those that provide support services such as photography, video, staging, valuations and building reports.

Sales for the month at 666 were down a third on the 1,020 sold in August and 40% on the 1,099 sold in the same month last year.

Given September’s trading was conducted in lockdown, Thompson says the number of sales in the month was an outstanding result.

New listings of 977 properties was also impressive, he says especially when seen against the challenges vendors faced on putting the final touches to their pre-listing activity.

“While new listings during the month were down nearly a quarter on those for August, it is four times the number of new listings when we went into lockdown in April last year.

“At the end of the month, the agency had 2,727 properties for sale, an extremely low number at the start of spring,” says Thompson.

“Feedback from branches is there is strong inquiry among vendors and buyers and the moment Auckland moves to level two there will be a strong surge in listings and sales.

“Activity in the rural and lifestyle markets was restricted by the combination of lack of listings in all market sectors and the lockdown regulations. Sales for the month at $55 million was the lowest month’s trading in this sector since June last year.

“There is strong demand for bare one-hectare plots at present, as buyers seek to counter the shortage of existing homes for sale on small blocks.”

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