Mortgagee sales dip in Wanganui

Properties up for mortgagee sales are being drip-fed on to the market, a Wanganui real estate agent says.

Ross Watson, of Watson's Real Estate, estimated about five mortgagee sales took place in the region each month.

"If they [financial institutions] bring too many at once, they probably know it could distort the market, especially in a provincial centre like Wanganui," he said.

Quarterly figures from information company Terralink show four forced sales occurred in Wanganui between April and June, down from nine for the previous three-month period.

The Terralink figures are derived from foreclosure registration data supplied by financial institutions. However, commentators warned yesterday they may include sales from prior periods.

Mr Watson said that, while the Wanganui property market was not booming, buying and selling levels were holding steady.

"Our monthly sales volume is about 50 [properties].

"About two years ago, when we hit rock bottom, we reached an all-time low of 22 [properties]," he said.

"Then in 2005, at the top, we recorded an all-time high of 180 in one month.

"The numbers would indicate a restored confidence in the market ... which is good."

Nationally, forced property sales are taking place at rates similar to those last seen during the peak of the recession in 2009.

In the first half of this year, 1129 mortgagee sales occurred, up from 1007 during the same period last year.

This compared to 1262 foreclosures during the first six months of 2009.

New Zealanders are battling rising food costs, record-high petrol prices and stubbornly high unemployment.

Terralink managing director Mike Donald said with no signs the economy would pick up anytime soon, the number of foreclosures was expected to rise.

"For most of 2011, it looked like the era of record high numbers of forced sales was finally on its way out. Unfortunately, since October 2011 we've experienced the opposite," he said.

However, provincial New Zealand seemed to be immune from the spiralling number of foreclosures by banks.

Apart from the Bay of Plenty and Northland areas, where mortgagee sales jumped 35 per cent between the first and second quarters of this year, most provincial areas had remained relatively stable, Mr Donald said.

This contrasted with a spike in city areas - in the Wellington region foreclosure numbers jumped 56 per cent between quarters, he said.

A breakdown of the figures show "mum and dad" property owners make up at least one in five mortgagee sales.

This was a worrying trend, Mr Donald said.

"With properties that are likely to be family homes making up almost a quarter of sales, there's no sign of economic recovery for ordinary New Zealanders."

Quarterly results show corporate investors who owned more than 11 properties had suffered the most this year.

Forced sales for this group jumped from 16 per cent in the first quarter to 25 per cent.

Mortgagee sales forfirst half of the year

National

2012: 1129

2011: 1007

2010: 1231

2009: 1262

Wanganui

2012: 13

2011: 16

2010: 6

2009: 6