Auckland’s property market showed signs of waking up from an extended lull in August as sale prices, turnover and new listings all increased, says realtor Barfoot & Thompson.
The median sale price increased 3.7 percent to $840,000 in August from a year earlier, while the number of sales gained 2.3 percent to 795, the city’s biggest real estate agency said in a statement.
Auckland’s property market has been cooling over the past year as government efforts to restrict the sale of residential property to foreigners and encourage new construction combined with Reserve Bank-imposed mortgage lending restrictions and tighter lending criteria.
That slowdown saw number listings dwindle as owners refrained from putting their houses on the market, and the number of available listings at the end of August was 4,022, a 0.7 percent increase from a year earlier, but still the fewest since September.
Still, Barfoot managing director Peter Thompson said new listings climbed 5.6 percent to 1,331 from a year earlier, in a “positive sign the market is gearing up for a positive spring.”
Reserve Bank data last month showed low equity mortgage lending accounted for 10.2 percent of the market in July, the highest level since the RBNZ restricted the level of lending banks could make to borrowers with less than a fifth down as a deposit. Looser LVR restrictions have encouraged the likes of state-owned Kiwibank to pitch for Kiwibuild and first home buyers generally, offering loans to borrowers with just 10 percent down and adding a low equity fee.
Thompson said 13 percent of houses sold in August were for less than $500,000, compared to 9.8 percent in July.
“The number of sales in this price category have been climbing in the past six months and are being affected by the higher number of apartment sales now taking place,” he said.
The top end of the market – $1 million-plus – accounted for a third of Barfoot’s sales, largely unchanged from 32 percent in July, and of that, 13 percent went for more than $2 million, Thompson said. Just 4.1 percent went for $2 million or more in July.
Auckland property prices soared ahead of much of the country through the middle part of the decade, fuelled by cheap finance and as a shortage of housing failed to keep up with an expanding population. Real Estate Institute of New Zealand figures show affordable housing below $500,000 accounted for about 42.5 percent of the country’s turnover in July, while $1 million-plus property sales made up 13 percent.