Looking Back at November: The Auckland Market Bounce-Back
It finally seems as if the Auckland market has shaken off its winter blues in November as house sales and house prices both started to head in more positive directions, possibly indicating that the market could heading towards a strong summer.
Things seemed to really kick off when Auckland’s largest real estate agency, Barfoot & Thompson announced that they sold 960 residential properties in November, up from 824 in October and the highest number for the month of November since 2015 when it sold 954. Prices were also firmer, with the average selling price for the month hitting $963,671, which has only been exceeded once before, in March 2017 when it hit $968,570.
The Real Estate Institute of New Zealand’s November data has also shown that November’s sales were up 8.7% compared to a year ago and up a whopping 19% compared to November 2017.
To follow this up, The HPI (House Price Index) has indicated that house prices are once again on the rise in the city. The HPI tracks the movement in prices around the country and also allows for changes in the mix of property types sold each month when calculating price movements, so is seen as a more accurate reflection of price movements than shifts in median or average prices.
One of the most significant trends in the November HPI was a turnaround in the Auckland market, which went from having a 0.1% monthly decline in prices in October to a 2.1% gain in November, and on an annual basis, prices in Auckland were 2.7% higher in November than they were a year earlier.
These numbers are a welcomed sign as we head towards the end of a shaky year of sales, and with listings down 11% from the previous year. Many are hoping that the market could see a huge uptick in listings early next year, when potential vendors who may have been holding off listing their property while they waited to see how the market shapes out before they decide to commit to a sale over the summer season.
It seems that the low mortgage rates and proposed bills such as the capital gains tax getting the axe has brought back some buyer confidence into the market. Summer does tend to have more activity than winter, but these November numbers are a good sign that things are heading in the right direction. Many will be watching to see If the trend heads in a positive direction in early 2020 or if they flatten.