NZ Property Market In A Spin

A matter of days ago the NZ Herald faithfully, and with a straight-face, reproduced Barfoot and Tompson’s report that Auckland’s residential property market in March was at a four year high, exceeding “anything we’d ever experienced” according to Barfoot’s managing director Peter Thompson (read “Auckland house sales reach four year high“)

Apparently the average selling price hit an “all time high” of $581,190, helped by a number of buyers purchasing property in the “over $500,000 category.”

Somehow Auckland’s property market is reacting in a different way to the rest of New Zealand. The spike was spun as a return of confidence in the Auckland  market and not an impending property price bubble.

Or perhaps the average price increase was because the sale of a few multi-million dollar properties skewed the results in an abnormal way?

BUT before you believe the hype and rush-in to buy or sell a home you should read the Herald’s equally straight- faced report published today (read “Property values steady, but recovery shortlived”)

Its based on information by the NZ valuation company QV: the people who probably have a better understanding of how the market is fairing.

The first signs of a recovery in national property values appear to have been short lived, if you blinked you probably missed it. Quotable Value said that values fell back in Auckland and Wellington during March.

Not only have prices fallen back but the market has also remained stable. Does this indicate that sellers are prepared to accept lower offers to achieve a sale? So much for the four year high

QV’s director of research told the paper (emphasis ours)

“the levelling of property values in the last few months was largely driven by a slight recovery in values in both Auckland and Wellington.

“These first signs of a possible recovery in values were shortlived as both Auckland (down one per cent) and Wellington (down 2.9 per cent) slid back again in March.
The average New Zealand sales price fell $11,000 to $400,656 in the three months to March, when compared with last month, while values nationally are now 2 per cent below the same time last year.

Glenda Whitehead of QV Valuation said the underlying statistics suggested the Auckland market remained stable, but a prediction of limited short-term value growth meant the market lacked urgency.

That may come as a relief, you can afford to take your time now and look around for property.