Smart Sellers Taking Advantage of Pre-Spring Rush
Smart property sellers know that the flush of new listings in Spring will provide more choice for buyers and extra competition for sellers, and are taking advantage of buyer frustration generated by the Winter struggle to find property by listing now. That’s according to Harcourts New Zealand CEO Bryan Thomson in the latest issue of MarketWatch newsletter.
Mr Thomson added, “In the world of real estate, July is often the ‘lull before the storm’. It’s the depth of Winter and this is often the month people take Winter holidays, complete interior maintenance on their homes and, if thinking of selling, get ready to act when Spring arrives.” As a result there are fewer listings around to satisfy the buyers.
Analysing Harcourts’ statistics from July 2005, Mr Thomson described the month as “a perfect example of a ‘normal’ Winter market. Listing numbers were tight and with written sales at similar levels to July 2004, we are constantly seeing competition for well located and well presented properties.”
Comparing the prices achieved in July 2005 with July 2004, he said, “Prices remained well above July 2004 in most locations, although sellers must ensure their Consultant provides solid market information to avoid overly optimistic expectations.”
Looking ahead, Mr Thomson concluded, “With Spring just around the corner, the market is looking very positive. Not even a looming election seems to be impacting on the nation’s positive mood which is being boosted by job and income growth, low interest rates and improving weather.”
August 2005 Issue
In the world of real estate, July is often the ‘lull before the storm’. It’s the depth of Winter and this is often the month people take Winter holidays, complete interior maintenance on their homes and, if thinking of selling, get ready to act when Spring arrives. However, smart sellers know that the flush of new listings in Spring provide more choice for buyers and extra competition for sellers, and so take advantage of buyer frustration generated by the Winter struggle to find property by not waiting until Spring to list.
And at the risk of being predictable, July 2005 was a perfect example of a ‘normal’ Winter market. Listing numbers were tight and with written sales at similar levels to July 2004, we are constantly seeing competition for well located and well presented properties. Prices remain well above July 2004 in most locations, although sellers must ensure their Consultant provides solid market information to avoid overly optimistic expectations.
The lower number of properties being offered for sale by auction remains a mystery.
This method continues to produce the best results of all sales methods available and sellers should rethink their marketing before dismissing this as an option. With Spring just around the corner, the market is looking very positive. Not even a looming election seems to be impacting on the nation’s positive mood which is being boosted by job and income growth, low interest rates and improving weather.
Bryan Thomson, CEO
Harcourts New Zealand
July 2005 July 2004 %
Exclusive Listings 631 580 +9%
Auction Listings 42 86 -52%
Property on Hand 1,753 1,906 -8%
Written Sales 576 572 +1%
Average Price $401,000 $337,000 +19%
A very positive and balanced market in the Harcourts Northern Region. Prices remain positive and properties in key locations remain in strong demand. Property on hand remains below 2004 levels.
July 2005 July 2004
Exclusive Listings 397 424 -6%
Auction Listings 47 60 -22%
Property on Hand 1,527 1,435 +6%
Written Sales 461 481 -4%
Average Price $275,000 $254,000 +8%
A very similar market to 2004. New listings are slow coming forward, placing pressure on buyers.
July 2005 July 2004 %
Exclusive Listings 368 332 +11%
Auction Listings 39 36 +8%
Property on Hand 1,327 1,106 +20%
Written Sales 418 459 -9%
Average Price $266,000 $236,000 +13%
The one region that has had a better listing month than July 2004, hence property on hand has grown. Sellers need to recognize that they are competing for buyers and invest in quality marketing to attract the most motivated buyers to their property first.
July 2005 July 2004 % Change
Exclusive Listings 538 588 -9%
Auction Listings 52 70 -26 %
Property on Hand 1,729 1,712 +1%
Written Sales 556 582 -4%
Average Price $314,000 $285,000 +10%
Listings remain tight with sales similar to 2004. Prices are positive and the amount of available property is consistent.
SOUTHERN (EX CHC)
July 2005 July 2004 % Change
Exclusive Listings 240 262 -8%
Auction Listings 24 33 -27%
Property on Hand 1,282 1,060 +21%
Written Sales 247 225 +10%
Average Price $296,000 $199,000 +49%
The average sale price shows a massive jump, however rather than a trend, this was due to a significant one-off sale. Buyers continue to be positive with more choice in a number of markets.
How Do Elections Affect Your Mortgage?
With the elections just under a month away, there are a number of factors that not only come in to play when deciding who to vote for, but also what to do with our mortgages. In summary:
- The New Zealand economy is slowing - whilst momentum remains reasonably solid, the pace of growth is being curtailed by limited resources such as labour, immigration and tighter monetary conditions.
- Inflation is remaining persistent, but should ease as 2006 approaches.
- There is continued downward pressure on the NZ dollar which will positively impact on exporters.
- Globally interest rates are rising and commodity prices could turn sharply.
- Petrol prices keep rising.
- Wages are not keeping pace with business growth.
Taking all this into account, the chance of interest rates dropping in this climate is going to be unlikely. The prospects of them rising (in the short term) are also going to be unlikely.
So what should I do as a home-owner/investor/borrower? The same as perhaps in any market - stay “flexible” – fix some part of your mortgage and keep some on a variable rate.
If in doubt as to what to do, ask an NZMBA-accredited broker. As a NZMBA-accredited broker, Mortgage Express provides you with “choices” and the best, most up to date information is what we do best!
Andrew L’Almont, CEO Mortgage Express
Tel: 09 379 4298
(Mortgage Express is the largest non-franchised broker in New Zealand)
Harcourts Rural Productive Spring Start
As we move into Spring it is always great to see the next productive cycle commence with lambs and calves appearing around the country.
Excellent July and early August weather around New Zealand has delivered the prospect of a top lamb crop for sheep farmers and with calving underway now with most dairy farmers hopefully a straight forward calving result for them.
Animals on farms are mainly in very good condition with good scanning results and continued grass growth in most areas. A kind Winter has assisted here with only half the average number of frosts recorded in most areas around New Zealand.
Farming is very intensive these days with trials focusing on triplet survival, pasture composition on lamb growth rates and animal management for increased progeny survival all being worked on presently. Livestock returns continue to be positive with most primary products enjoying positive rises over past weeks.
The rural real estate market continues to be buoyant over most classes of land with ongoing strong demand and shortage of good properties currently for sale. The market is especially strong for well maintained properties in good locations with an established productive history.
Buyers know these properties will continue to produce at good levels with ongoing management and inputs and do not require major investment to bring them up to a level of production to justify the price paid. I would suggest that any premiums currently being paid are for these well maintained properties with proven historical production levels.
The country living and rural-residential property market also continues to be buoyant for well located, tidy properties with good improvements.
Kim Shannon National Rural Manager
While every effort has been made to ensure that the information in this publication is accurate we recommend that, before relying on this information, you seek independent specialist advice.
Harcourts has been in existence since 1888 and is New Zealand’s leading real estate group with over 170 offices.
In 1997 Harcourts moved into Australia where it now has over 160 offices throughout Queensland, Sydney, Western Australia, South Australia, and Tasmania. Harcourts also has 10 offices in Indonesia and two in Fiji. Harcourts MarketWatch is compiled by Helen Fergusson, Communications Manager, Harcourts International Ltd, tel 03-348 8784.