Steve Hart: Buyers buoy up market

The firm sold 757 properties last month. Photo / Ted Baghurst

Buyers are returning to the Auckland property market following a two-month drought, if Barfoot & Thompson's sales figures for November signal the start of a new trend.

The firm sold 757 properties last month, the highest number of monthly sales at the firm since August. Kiri Barfoot, a director at the firm says: "There are certainly no signs of a general market retreat.

"Both the average price at $913,244, and the median price at $830,000, were right in line with what we have been achieving over the previous three months.

"While those numbers are down on their equivalents in November last year, that was a time when the market was close to reaching its peak.

"This November's trading is a sure sign that, at current values, buyers are returning to the market."

Last month the firm listed 1955 properties, a third higher than the average over the previous three months.

"It brought the number of properties at month end to 4838, the highest number we have had in more than five years," says Kiri.

"There is now a quarter more properties on the market than at the same time last year. At the high end of the market, buyers are still seeing value in property at current prices with a significant rebound in the number of properties sold for in excess of $1 million."

Kiri says a similar pattern of activity was seen in the lifestyle and rural sectors with sales in Mangawhai and Wellsford in the north and in Pukekohe and Papakura to the south.

"We sold 62 rural and lifestyle properties in November ... Interest from local developers and land bankers is returning, but there is still a degree of hesitancy."

Muted growth
The housing market is looking a lot softer than it did a year ago, warn economists at Westpac. They say sales of real estate are down sharply, and the double-digit price gains seen in previous years have given way to a period of "muted nationwide price growth".

They say it's important to remember the Government is planning on rolling out a suite of policy changes to "dampen house price inflation over the coming years".

"This limits the risks of a large uplift in prices over the next few years, even with the loosening of lending restrictions," they say.

They also say that rising building costs, stretched capacity, and tighter bank lending standards for property developers are providing a brake on new building activity.