Since the end of the year and more predominantly in the early. O this of this year, Auckland house prices have seen a slight drop in prices, with many’s agencies reporting that they aren’t selling as many properties as the same time last year. Some see this as potential good news as lower prices make it easier to enter the market, but this the Australian market recently taking a huge hit when the property bubble burst, should we be worried?
Recent reports have indicated that the average value of residential properties in Auckland over the three month period to the end of February this year was $1,044,576, which was down 0.9% compared to the same three month period a year earlier. Real Estate Institute data just out showed that sales were down from 1654 residential properties sold last February to just 1358 last month.
So with this in mind some people may be thinking that we are being to show the same cracks that formed in Australia that caused their property bubble to burst, so should we be worried?
Many experts are keeping an eye on the market but have mostly shared the same verdict that we are still in a stable market. So that still begs the question, why the sudden fall? Well the answer comes down to the type of buyers currently in the market, and some facts may surprise you.
Recent data has show that in the r net cases of sales and price decline, that it is the more expensive homes and suburbs in the upper end of the market are also leading the decline – in both price and volume.
Many have put this down to a higher activity of buyers in the lower end of the market, due in part to the increased activity of first-time buyers returning to the market and looking for more affordable homes. Whereas those looking to buy and sell at the top end of the market are usually less likely in an immediate rush to buy/sell and will be monitoring the market in the coming months.
So first time buyers are beginning to full he void where the top end buyers are currently holding back, so there are homes selling, Justin the more outer suburbs – and for cheaper. With interest rates continuing to meet record lows and more initiatives from the government to help first time buyers get it to homes, we could see this trend continue.
As for the investors and more upper-end buyers in the market, it wouldn’t be surprising to see if they return more prominently towards the end of the year when some of the proposed law changes to the property market take place.