Shannon's Manukau market wrap
Manukau Market Wrap
So how is the market?
Things are looking good; volume is still down, but prices are stable and clearance rates have significantly improved. We have definitely seen a resurgence in activity this past month in Manukau. Stock levels remain low and demand appears to be stronger than supply. So, have there been more buyers, or just less stock? It is a combination of both, and there are a number of positive contributing factors at play.
There were 370 sales in August 2019. When we compare this to August 2018, the number sat at 391 — so, in terms of sale volume, Manukau performed pretty well.
The average sale time sits at 47 days with an average sale price of $770,000 (although this number is down from $860,000 compared to the same time last year).
If we compare these figures to those across New Zealand in August, the numbers decrease by 6.1% from the same time last year (5,959 homes sold, down from 6,346) — the lowest level of sales for 7 months. Additionally, we’ve had 3,624 fewer new listings than at the same time this year.
With limited choice in many parts of the country for new listings, I would say that people are waiting before putting their homes on the market closer to spring or summer (which is traditionally the case).
However, what we are finding is that listings which have come in before spring are dealing with less competition. The past three sales I made all sold within the first week of open homes and either above CV or for a record sale price on that street. Buyers are definitely out and ready to buy, particularly first home buyers. If your home has that unique factor — i.e. a home with an income or a sub-dividable section — these are also always popular.
The removal of Capital Gains Tax from conversation and the reduction of the Official Cash Rate (leading to record low interest rates) has led to more people buying, more investors back in the market and generally more confidence overall.
Prices going up in the regions — in the more desirable larger regional cities, the price gap is no longer as big as it once was. This could be interpreted as more people deciding to just stay and buy in Auckland.
Investors who had been holding off from engaging the market are not getting anything for their money in the bank. Confidence that the Auckland market isn’t going to tank is luring them back in.
First home buyers are in force. The past six months has probably been the best time in years for them to buy given the attractive interest rates. The recent commentary from Tony Alexander, BNZ, suggests fixing for one year in anticipation of further rate falls to come.
Immigration is still strong and the market is also looking good in Sydney and Melbourne across the ditch.
A winter that started with some pretty average figures has moved on to spring with everybody feeling a lot more confident about the market moving forward. Whether we see a dramatic improvement in prices is yet to be determined, however, right now is definitely the best it has been during the balanced market (post 2016).