Too Soon To Talk About Another Housing Boom

Harcourts says August good, but too soon to talk about another housing boom


14 September 2009: Harcourts’ August figures show spring came early to much of the New Zealand real estate market, but it’s too early to talk about another housing boom, according to Harcourts New Zealand CEO Bryan Thomson.

According to the final, audited August figures of New Zealand’s largest real estate group, Harcourts’ sales consultants completed a national average of approximately 47% more written sales last month than in August 2008, with a total of 2030 written sales making it the second highest amount since November 2007, Mr Thomson says.

Commenting in the latest Harcourts MarketWatch newsletter he says the largest increase occurred in the group’s Northern region (which includes Auckland) where the volume of written sales last month was a significant 78% ahead of August 2008 and in addition the average sale price was up 11% on the same month last year.

“In three of Harcourts’ other regions there was also an increase in written sales last month when compared with August 2008, with our South Island Provincial region being the only exception.”

Harcourts’ figures show more properties came onto the market last month than in August 2008 but Mr Thomson says the total volume of property on hand remains limited and in some regions the slow rural market is continuing to impact on average sale prices.

“While confidence in the market appears to have returned we have to be mindful of the fact that the numbers we are seeing this year are being compared to the historically low numbers of 2008. If you look further back in time our national sales numbers remain 25% below the peak of August 2005.

“So, while the market is more positive and active and the lower number of listings we have seen over winter has created competition and helped to stabilise prices in many locations it’s too soon to be talking about another ‘housing market boom’,” Mr Thomson says.

“Notwithstanding that, serious buyers are taking action now while asking prices and mortgage interest rates are more attractive and smart sellers are seizing the opportunity to list their property before more stock comes onto the market and balances out the current situation.”

For more information see Harcourts MarketWatch newsletter (attached).

ENDS

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