Auckland house price retreat may be short lived

Auckland residential house prices in February have retreated from the record prices set in the second half of last year but are still higher than where they were at the same time last year.

"The average sales price at $822,024 in February was up 1.3 percent on the average price for January and up 10 percent on that for February last year," said Peter Thompson, Managing Director of Barfoot & Thompson.

"The median price at $738,000 was down 2.9 percent on January’s, but up 7.5 percent on last February's.

"While prices are down from their record highs, based on past trends, prices in coming months are most likely to build modestly.

"This trend has occurred over the past 9 years where Auckland house prices have followed a cycle of falling in the first quarter of the year and then rising from autumn on.

"We have now had two months of trading where prices have been higher than they were in their equivalent months last year, and in the past that has meant prices have risen throughout the year.

"The most significant figures in February’s data were that sales numbers stalled and new listings doubled.

"The number of properties sold at 698 was the lowest in any month for 3 years. The reason was that at the start of February the number of properties on the market was at its lowest number for 20 years, and buyers had limited choice.

"However, as the month progressed more properties were listed, and we finished the month with 2,060 new listings, the highest number in the past six months. There are currently an extremely high number of properties in the pipeline for settlement in March and April.

"At month end, we had 3,318 properties on our books, the highest since March last year, and we anticipate an extremely busy period through autumn.

"Another factor that affects the average and median sales price in the early part of the year, is the summer break results in a relatively low number of sales in the $1 million plus price category. Throughout last year, on average, we sold 332 properties a month in the $1 million plus price category, but in February the sales in this price category numbered 187.

"Sales of properties for under $500,000 in February made up 20.6 percent of all sales, whereas throughout last year they averaged 14.9 percent of sales."

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Barfoot & Thompson is Auckland's leading real estate company, selling around one in three Auckland residential homes, significantly ahead of all other competitor brands. Their Auckland Property Management division manage over 12,000 rental properties and have residential property managers in over 50 branches.