NZ property rediscovers pre-GFC market

November 2012

NZ property rediscovers pre-GFC market

October 2012 has proved the strongest month in the real estate market since the global financial crisis, at least for one major real estate group.

Figures collected today show the Ray White Group recorded sales up 29 per cent on October last year and matched the turnover high unseen since March 2007: $500 million.

The network of 135 offices finalised 1,216 sales, 21 per cent more than the previous month and the greatest number of transactions since November 2007.

The Auckland market in particular has shown a considerable increase, with double the sales recorded in 2012 against the same period in 2011.

Carey Smith, Chief Executive of Ray White New Zealand, said the 2012 sales have continued steadily, with turnover increasing by 41 per cent nationally in the year to date.

“This is driven by a combination of factors, including the continued migration and relocation throughout New Zealand of those affected by the Canterbury earthquakes and record low interest rates, which have been consistent for over 12 months and give buyers confidence. Added to this, banks are taking a balanced approach to the way they consider funding property, which allows buyers to purchase property.”

Across New Zealand all markets continue to show higher sales volumes. The Canterbury area has returned to its pre-earthquake sales numbers and is up 37 per cent on last year. Most activity around the country is occurring in the CBD and city fringe markets, where there continues to be a lack of stock, placing pressure on prices – which are increasing – and lowering the days on market.

Megan Jaffe, the owner of Ray White Remuera, completed over $30 million in sales for October.

“There is definite momentum in the market at all levels. Sellers are showing they are responsive to the market. They are sellers one day and becoming buyers the next,” she said.

Simon Damerell from Ray White Ponsonby, who works through the city fringe markets, said there has never been greater numbers of open home attendees and registered bidders at auctions.

“There is a high degree of activity and while there may appear to be a shortage of stock, the same number of properties are being listed; it’s just that the higher turnover is at any given time resulting in fewer properties on the market.”

Tony McPherson from the Ray White Metro group in Canterbury said that there is continued activity throughout Canterbury with the movement of those in the Red Zone and those relocating into the city for work opportunities.

“The movement of people and the rebuild plans recently announced have added increased activity into the Canterbury market, and that is resulting in record sales.”

The national average sale price value at the end of October 2012 for Ray White was $452,592. This is up on September 2012 at $445,326 and up on October 2011 at $440,918.

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