By General Manager – Robert Carter BBS
A renewed market energy was evident in March when compared to January and February with 304 North Shore sales as opposed in 155 & 198 in the prior two months. The first quarter 2019 volumes are still significantly lower than prior years, with 411 North Shore sales in March 2018.
A variety of favourable & unfavourable factors continue to affect the property market resulting predominantly in a notable reduction in sales volumes. Some of these factors are illustrated below:
Despite low interest rates, the legislative changes and difficulty obtaining finance continue to restrain sales volumes. Hopefully, as we gain more certainty in relation to Capital Gains Tax, we will see volumes rise.
North Shore prices continue to remain relatively stable despite monthly variances, with a median price of $1,010,500 in March 2019, 6.4% down on $1,080,000 in March 2018. Median days to sell in March were 42.
There continues to be a multitude of factors providing confidence in the market and delivering plenty of success stories. In March Harcourts Cooper & Co had 150 settled sales. In the adjusting market as we see more choice become available for purchasers; it is proving vital that vendors have the correct marketing strategy, sales people and realistic price expectations are set in order to achieve a successful sale. It could be argued that it is a fairer market for both buying & selling!
Low volumes, yet favourable conditions
By General Manager – Robert Carter BBS
There is a myriad of factors influencing New Zealand’s property market resulting in varied market performance. 14 of the 16 regions in New Zealand experienced annual increases in median prices for residential sales, some with records being broken. Auckland & Canterbury markets have seen decreases in both prices & volumes.
Looking specifically at Auckland’s North Shore market, in January there were 152 sales according to REINZ, the lowest monthly sales volume in over 20 years! The North Shore City median price in January 2019 was $920,000, down 13.2% from $1,060,000 in January 2018.
There continues to be a multitude of factors providing confidence in the market. Overall a positive economy with strong population growth, an ongoing housing shortage and record low interest rates. Not to forgot being a very desirable city to live in! On the contrary, factors potentially contributing towards the slowing volumes are reserve banks LVR restrictions, foreign buyer policy, anti-money laundering legislation along with increased requirements for landlords, and a potential capital gains resulting in cautious investor activity.
Heading into February & March when the market typically gains momentum, we are seeing a notable increase in properties coming to the market and buyer activity is high. We will have a better indication of the year ahead this time next month, but in the meantime, it appears positive and a great time to be buying & selling in fair market conditions.
The Perfect Plateau
December statistics provided further confirmation that the housing market has cooled. At the same time there is an apparent calm about the market. With confidence that whilst volumes are low, and prices have corrected slightly the market remains stable and this recent correction may well have prevented something more drastic happening to the property market.
North Shore sales volumes in December were the lowest since the 2008 GFC. There were 213 North Shore sales in December 2018 compared to 278 in December 2017. 2017 and 2018 annual trading volumes were relatively similar, with 2018 volumes 4.6% lower than the prior year.
Median prices on the North Shore also saw a decline of 11.6% to $980,000 when compared to December 2017.
Days on the market have crept up sitting at a median of 40 in December.
There is an eclectic combination of factors contributing to the current market, ultimately producing an element of more than usual choosing to ‘wait & see’. The current market is producing great opportunities for buyers and we have experienced a marked increase of first home buyers. Some of the factors influencing the current market are the introduction of the new Overseas Investment Act, the declines in the Australian property market and potential Capital Gains Tax for investors. On the contrary Auckland has a housing & rental property shortage, low interest rates and not to forget ‘the North Shore is a great place to live’!
All in all we predict an interesting year and a stable market. There will be a necessity for those vendors looking to move on to ‘meet the market’ as it turns slightly in favour of buyers. It will be a year where choosing to align with the best available property experts will be rewarded.
Confidence & comfort in market heading towards Christmas
In the final run to Christmas, the North Shore market continues to show consistent, fair trading and is well poised heading into 2019.
North Shore’s median sales price continues to hover around the $1M level. November 18 had the highest median price in 8 months of $1,041,000 although still down 2.2% on November 2017 median of $1,064,500.
There were 313 sales on the North Shore in Nov 18 compared to 309 in the same period last year. Whilst these sales volumes have been relatively consistent over the past 2 years, they are historically low. Putting into context the average volume of sales on the North Shore in a November across the past 12 years was 451. Days on the market remain relatively low at 37.
Nationally, strong growth in the regions resulted in another record median house price of $575,000 in November, up from $540,000 at the same time last year.
On the 1st January 2019, changes to the Anti-Money Laundering and Countering Financing of Terrorism Act take effect for Real Estate which will require customer due diligence at the time of listing, with extra requirements for properties owned by Trusts or Companies.
Market conditions providing fair trading, comfort & opportunities for both buyers & sellers.
Best wishes for a very Merry Christmas & a prosperous 2019