By Jenny Ruth
Aug. 2 (BusinessDesk) - Auckland’s biggest realtor says there was a “modest but definite” shift in the housing market in July when property prices fell but sales numbers rose.
“The modest fall in both average and median prices in the month was enough to unlock sales numbers, with July sales being their highest in the month of July for three years,” says Barfoot & Thompson managing director Peter Thompson.
In the previous three months, sales had been more subdued with prices tending to edge higher.
“In July, the fall in prices compared to the average for the previous three months was relatively small in the case of the average price at $919,648, down $12,000, but more significant in the case of the median price at $800,500, down $41,000,” Thompson says.
Barfoot’s sales totalled 879 for the month, 11.8 percent more than in June, 16 percent ahead of the average for the previous three months, and 5.9 percent ahead of July last year.
“It is a positive sign that the Auckland market is getting through the traditional winter downturn in better shape than in the previous two years,” Thompson says.
The Reserve Bank cut the official cash rate to a record low of 1.5 percent in May and is expected to cut again next week.
The GoodReturns website shows that mortgage rates on the most popular two-year fixed rates started falling in March. For example, ASB Bank’s standard two-year rate has fallen from 4.69 percent to 4.29 percent while its “special” has dropped to 3.79 percent.
“A feature of July’s sales was the relatively high number of sales of property in the under $500,000 price category, which at 15.9 percent of sales was significantly higher than we normally see,” Thompson says.
“It points to the higher number of apartment and terrace housing sales showing in the monthly statistics and the growing acceptance in Auckland of this form of housing.”
He is predicting this segment of the market will continue to impact average and median sales prices.
About 28 percent of Barfoot’s sales in July were of properties worth between $1 million and $2 million, a category which regularly makes up a third of total sales.
Barfoot’s new listings in July at 1,154 were up 14 percent from June, and up 9.2 percent from July last year. At month's end it had 3,864 properties on its books, the lowest number for sale it has had in the past 17 months.
“With buyers re-entering the market, now represents a good time for those considering to sell their property to list,” Thompson says.
Barfoot’s rural and lifestyle block sales were strong for a second month with property sales at prices below $1.5 million “solid” and including a number of properties that had been on the market for some months.
But rural and lifestyle property sales north of Auckland are being restricted by listings not matching buyer interest, he says.