Crockers Market Research - sept... · 2016. 11. 10. · Crockers Market Research Auckland median sale price increases The 1,505 sales in Auckland in July moved even closer to the

Crockers Market Research

Auckland median sale price increases

The 1,505 sales in Auckland in July moved even closer to the low points of 2 years ago and down a quarter on the same month last year.

The one glimmer of light is that median prices have continued the recovery that began in June, and are now to $450,000. While many home owners are still struggling, the number of fire sales seems to be on the wane.

National sales numbers have also continued to fall – from 2,930 in June to 2,906 in July. After rising momentarily in June, the national median price has sagged back to $349,000 – lower than it was in May.

Should we read too much into these numbers? After all, Winter is generally a slow time in the residential property market.

The charts top right show July sales prices and volumes compared with last July. Going on these numbers, while median prices seem to be holding firm, the sharp drop in sales volumes are clearly more than just a seasonal phenomenon. (see charts 1 & 2 top of right column)

Looking at this another way, if we compare the July figures to the average of the previous 12 months, we see that this mid Winter malaise is not in fact all that new, though it has been arguably on a downward trend in terms of sales prices. However, July sales numbers of around 20% below the previous year’s average have been seen in 2004, 2007, 2008 as well as in the current year. (see charts 3 & 4 top of right column)

Does that mean the entire property market is trending the same way? No. As some commentators

Reports on the residential property market have made grim reading recently, and there’s

no sign of imminent relief. For the second month running, sales numbers are down even more

than usual for this time of year, following the pattern that heralded the start of the slide

back in 2007!

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Median price 2005 Median price 2007 Median price 2009Median price 2010Median price 2006 Median price 2008

Source: Real Estate Institute of New Zealand

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ld ($

’ooo

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4,000

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Number of sales 2005 Number of sales 2007 Number of sales 2009Number of sales 2010Number of sales 2006 Number of sales 2008


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Auckland residential property sales median prices

Auckland residential property sales numbers

Inside this issue • It’s a Winter thing: What’s the real impact of seasonality? • Rents rise • New law gives landlords some teeth

Issue 61 • September 2010

Crockers Property PO Box 74054, Greenlane, Auckland 1546Head Office 525 Manukau Road, Epsom, Auckland 1023 T 09 630 8890City Office Ground Floor, St Laurence House, 137 Quay Street, Auckland 1010 T 09 984 8044Botany Office Cnr Ormiston Road & Te Irirangi Drive, Botany Junction, Manukau 2016 T 09 271 1271Crockers Property Management Ltd and Crockers Realty Ltd, Licensed (REAA 2008) © Copyright Crockers Property Group 2010

have noted, astute investors can still make money. As the next chart shows, the proportion of high value properties sold (in this analysis at $800,000 or higher) remains relatively consistent during Winter, helping to maintain the median price despite the steep drop in number of sales.

At the other end of the scale, we see a recent small rise in the proportion of sales in the under $300k price band. This may reflect the relatively high numbers of mortgagee sales at the lower end of the market.

100%

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0%

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<$200k $200k-$300k $300k-$400K $400k-600k $600k-$800k $800k+


Jan-

06

Apr-0

6

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% of

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Price distribution of properties sold

Auckland residential property sales median prices

Auckland median prices in July vs average of past year

Auckland residential property number of sales

Auckland number of sales in July vs average of past year

Landlords finally get some teeth

Until now, the worst that a tenant who did a runner had to fear was being caught and having to pay the outstanding rent. In other words, it was a risk-free strategy. Under the new law, they could be forced to pay the landlord not only the rent, but also up $1,000 in compensation.

T he Residential Tenancies Amendment Act, passed by Parliament at the end of July,

clears up confusing processes around terminating and renewing tenancies, and introduces

new financial penalties for tenants who harass their neighbours or shoot through with

rent owing.

20%

15%

-5%

-10%

5%

10%

0%

% change vs July last year


2004

2005

2006

2007

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2010

% c

hang

e in

med

ian

price

in Ju

ly 50%

30%

-40%-50%

-10%

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-30%

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0%

-20%



2004

2005

2006

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% ch

ange

in n

umbe

r of s

ales i

n Ju

ly

8.0%

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-4.0%

-6.0%

0.0%

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4.0%

-2.0%



2004

2005

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% c

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e in

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ian

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in Ju

ly 30%

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2004

2005

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% ch

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in n

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- - - >

Crockers Property Group uses market data from a variety of sources which we believe to be accurate and reliable. This enables Crockers to provide analysis and interpretation on the property market. Opinions, statements and analysis are for general information only and should not be relied upon for any specific purpose. Crockers takes no responsibility for decisions you make based on data provided through Crockers Market Research.

Look, a price rise!

Rental levels in Auckland are moving too – but not consistently. The three-bedroom average of $456 per week is up slightly from June, while the two-bedroom average of $349 per week is down from June. Compared with the rest of the country, Auckland properties still boast a premium of 34% and 20% in the two- and three-bedroom markets, respectively.

While national three-bedroom rental levels remain flat (the average of $340 per week has

not moved since a slight dip in March), the two-bedroom market has climbed back to the

April high of $290 per week.

Aver

age

rent

per

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Auckland 3 bedroom NZ 3 bedroom

3 bedroom premium (RHS)

$500 100%

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$450

$400

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per

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Auckland 2 bedroom NZ 2 bedroom

2 bedroom premium (RHS)

$350

$400 100%

80%

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0%

$300

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$200

$150

Jul-0

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Jul-1

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3 bedroom properties 2 bedroom properties

The act has also been extended to cover boarding houses, which means boarding house landlords will have to give tenants 28 days’ notice of termination and the tribunal will be able to order landlords to carry out necessary repairs and maintenance.

The new laws will come into force later this year once supporting regulations have been approved and published.

Other key changes:• Landlordscanhavetenantsreimbursethemforreasonableexpensesincurredinrecoveringadebt.• Theintroductionofnewunlawfulactsbyatenantwithexemplarydamagesgoingtothelandlord,

including: failure to quit the premises at the end of a tenancy, using the premises unlawfully, harassing other tenants or neighbours and exceeding the maximum number of residents allowed.

• Thetenancycanbeterminatedifatenantassaultsorthreatensthelandlord/owner,ormembersof their family, agent, other occupier or neighbour.

• Landlordscanimmediatelydisposeofgoodsleftbehindattheendofatenancyifthevalueofthe goods is less than the cost of storing, transporting or selling them.

• Enhancementstodisputeresolution,includingincreasingmonetaryjurisdictionoftheTenancyTribunal from $12,000 to $50,000, so most disputes can be resolved quickly.

Adapted from an article provided by NZ Property Investor magazine.

$500,000 4,000

3,000

2,000

1,000

0

$400,000

$300,000

$200,000

$100,000

$0

Sales median prices Sales numbers


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Long term seasonal trends

A longer term view of patterns of seasonality for median sale prices in Auckland

(In this analysis Summer is defined as December, January and February, Autumn is defined as March, April and May, Winter is defined as June, July and August and Spring is defined as September, October and November. Winter 2010 data is for 2 months only, June and July). The yellow and green bars show a trend towards a dip in median sales values in the Summer months with a recovery during Autumn and into Winter.

The chart below shows the median sales prices for Auckland on a rolling 3 months for

summer, autumn, winter and spring.

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© Copyright Crockers Property Group 2010


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Crockers Market Research - sept... · 2016. 11. 10. · Crockers Market Research Auckland median sale price increases The 1,505 sales in Auckland in July moved even closer to the