A market of two halves
Robert Carter – General Manger
The ‘tug of war’ between market forces remains, yet evidently, the surge of momentum strengthens entering the Spring market.
Determination & confidence from buyers is resulting in some outstanding sales with a notable increase in auction success rates & auctions brought forward.
However, sales volumes remain suppressed due to the lack of listings. With 260 North Shore sales in August, it was the second lowest August volumes this century, just ahead of 2008 during the Global Financial Crisis.
The North Shore median price has tracked upward consistently, albeit minimally for the past 5 months to reach $999,000 in August.
Although there has been a reduction in sales, the activity & confidence in the market is undoubtedly increasing entering the Spring market. Days on the market remain relatively consistent at 44, prices creeping upwards, buyer confidence increasing along with Auction success rates all providing reassurance around the current market. The shortage of current listings providing an opportune time to list and stand out with less competition in the market.
Momentum builds towards Spring
Robert Carter – General Manger
Market indicators continue to point towards confidence moving forward. In July North Shore prices remained steady and volumes increased. At Harcourts Cooper & Co, our monthly auction success rate increased to 68% with an average of 2.2 bidders per auction.
The recent reduction to a record low official cash rate has added to the confidence provided by the abolishment of a proposed capital gains tax.
Investors are making their way back into the market along with increased demand from first home buyers.
Whilst we have seen a 13% increase in the number of CCC’s issued this year compared to the prior year, Auckland continues to have a housing shortage as a result of the accumulated shortfall in housing that built up due to many years of under building.
It’s like a game of 2 halves with current listings. Key factors for achieving a successful sale are the marketing & promotion, price expectations & sales method, the presentation of the property and agent & agency representing the owner. When the aforementioned factors are favourably combined, we are typically achieving great results. However, if a property has one or more of these not effectively managed or additional obstacle/s for buyers to overcome it is sometimes resulting in the property taking longer to sell.
With Spring just around the corner, signs are positive for an active market with opportunities for the astute.
Four Seasons in One Market
There are renewed signs of confidence and energy entering the market with solid demand for good properties that are well marketed. Last week 60% of Auctions at Harcourts Cooper & Co were sold under the hammer with an average of 2.3 bidders across all auctions. There appears to be an increase in the confidence of astute buyers possibly fueled by no capital gains tax and record low interest rates.
Listing volumes remain low and this is a contributing factor to the very low sales volumes. Looking specifically at the North Shore market there were 268 sales in June 2019 – the lowest since the 2008 Global Financial Crisis. The graph below depicts North Shore sales volumes since 2006:
Prices remain relatively stable. The North Shore market saw a 3.9% decrease in median price from $1,016,000 in June 2018 to $976,000 in June 2019. There was an increase in median days on the market to 47 in June.
There is a notable increase in first home buyers in the market. We have recorded an increase in investors re-entering the market with the latest change in legislation affecting landlords with the introduction of compulsory insulation in all rental properties from the 1st July, having little effect.
Low listing volumes continue to affect the property cycle with less choice for buyers. Prices continue to remain stable combined with very low interest rates, presenting an opportune time for the astute to transact.
Prices hold steady despite low volumes
By General Manager – Robert Carter BBS
Last week’s Official Cash Rate (OCR) cut combined with confirmation that capital gains tax has been axed all bode well for the New Zealand property market.
Prices continue to remain stable, although with more choice and less urgency from buyers it is vital that properties are well promoted, well presented and vendors price expectations realistic.
The uncertainty surrounding a multitude of factors at play effecting the property market is resulting in reduced sales volumes. It is yet to be seen if the further reduction in the OCR and abandonment of potential capital gains tax will assist in reigniting the market. At Harcourts Cooper & Co we have experienced a notable surge in activity following these announcements and only time will tell if this continues.
April volumes were some of the lowest on record, however there were several accentuating factors referred to above and the extended holiday taken by many around the Easter & Anzac Day holidays.
In April, Harcourts Cooper & Co had 117 properties that settled. Whilst volumes remain low, the current market is providing a stable & fair environment for purchasers & vendors to buy & sell with less pressure.