Auckland House Sales Strong Before New Investment Rules Announced
The Auckland residential property market lived up to its reputation of being at its strongest in March with record prices paid and a record number of homes being sold.
“In terms of both prices paid and the number of homes sold, this March was the strongest trading month in the company’s history,” said Peter Thompson, Managing Director of Barfoot & Thompson.
“The average price paid in March was $1,107,869, up 2.7 percent on the average price for the previous three months, and the median price was $1,048,000, up 5.1 percent on that for the previous three months.
“Contributing to the extraordinary sales numbers during the month were 2138 new listings in the month – the highest number of new listings in the month of March for 15 years and about a quarter higher than we would normally list at this time of the year.
“It gave buyers greater options than have been available for some months and they were quick to take advantage.
“During the month we sold 1844 homes, the most we have ever sold in the month of March.
“While buyers were committed, and prices rose, the rate at which prices increased during the month was in line with what has been experienced since the start of the year.
“The year-on-year average price increase was 11.5 percent, and the year-on-year median price increase was 13.3 percent.
“Getting in ahead of price increases and competition between investors and first-time buyers are not the only contributors to high market sales. There is also a strong undercurrent of social change as different groups of people act on their future housing needs.
“Baby boomers are rethinking their accommodation in retirement; working people are looking to shorten their commute time or achieve easier access to public transport or lifestyle amenities; people working from home are seeking alternatives to their current circumstances; and many are willing to put disposable income towards upgrading their accommodation.
“All are active in the market and see current mortgage interest rates, at levels never before experienced, as the ideal opportunity to make planned changes.
“In the first quarter of this year we sold 4054 homes. This is a third higher than the number of homes we sold in 2015, which was the past peak first quarter selling period, and came during the highs of the last price cycle.
“At month’s end we had 3394 properties for sale on our books, the lowest number at the end of March for five years.
“Based on sales numbers, the reintroduction of LVRs appears to have had limited impact.
“Demand for lifestyle and rural property in the north and to the south of Auckland remains high.
“In the north, interest in dairy and beef continues to be strong, and a number of large syndicates are looking for horticulture land, especially for kiwifruit development. Developers and investors remain interested in bare blocks of land, particularly that zoned residential or future residential.
“The shortage of residential listings is pushing some buyers into considering lifestyle bare blocks or existing homes, ensuring lifestyle blocks continue to sell well.”
Note: New LVR restrictions came into force on March 1. Virtually all the properties reported on in this statement were made prior to the Government’s March 23, 2021, announcement around investment properties. Sales cover only unconditional and commission paid sales.
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