Auckland Property Activity Rises, Average Price Growth Slows

Auckland Property Activity Rises, Average Price Growth Slows

While the Auckland property market experienced its busiest June in 11 years, the rate at which the average price is rising slowed considerably in the month.

“The number of properties sold at 1167 was the highest in a June month for 11 years,” said Peter Thompson, Managing Director of Barfoot & Thompson.

“At the same time we listed 1749 homes, the same as in May, but up by half on those for June last year.

“Auctions remained extremely popular, and during the month around three out of every four homes put up for auction sold under the hammer.

“While the market was extremely busy, the average sales price increased by only 0.5 percent or a little over $4000 on that for May.

The average sale price at $826,474 hit an all-time high but what was noticeable is there was a definite slow-down in the rate of increase.

“Over the previous three months, prices increased on average by 3.2 percent a month.

“The June year-on-year increase is now 15.7 percent.

“This is considerably lower than was being experienced in the first five months of the year.

“The same price trend is not as marked with the median price, which increased by 4.8 percent in June over that for May, and now stands at $786,000.

“For the previous 3 months the average median price increase averaged 6.5 percent a month.

“While the new Government and Reserve Bank measures which are due to come into effect in October are likely to be having some impact on prices, as will the approach of winter, there is also a growing feeling among buyers and sellers that homes are close to being fully priced.

“As we enter winter choice will remain a challenge, and at the end of June we had only 2959 properties on our books.

“June was the third month in a row when the number of properties for sale at month end declined, and choice is now the most limited it has been since last Christmas/New Year.

“During the month 370 properties sold for in excess of $1 million, nearly a third of the homes sold during the month being in this price category.

“While homes for sale under $500,000 are still available, in June only 159 or 13.6 percent of all the homes sold fell into this price segment.

“The 20 percent LVR regime is severely impacting sales numbers in this price category, and an easing of restrictions as it relates to homes of $500,000 and below would potentially redress the current declining sales trend, and also help lower the average selling price.”

ENDS

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