Home sales still rising in Auckland, but prices stall

Auckland house sales activity was at its highest in more than 15 years during July, but price increases have stalled, according to the latest real estate data.

Indeed, the average sales price at $827,359 has remained much the same as for the past two months, the figures from real estate agent Barfoot Thompson show.

In July the average sales price was within $1,000 of that for June, and only $5,000 ahead of that for May and managing director Peter Thompson pointed out that a stable average price over a three month period is a trend not witnessed for some time.

‘The combination of high turnover and stable price, points to buyer confidence in the strength of the market at current prices but also recognition that property is fully priced. The last three months of trading also demonstrates that high sales numbers can be sustained without prices increasing,’ he said.

‘The first signs that price increases were slowing could be seen in last month's sales figures, and this month's results confirm that prices are no longer racing ahead. In fact, the median price in July at $757,000 is down $29,000 on that for June, but up $7,000 on that for May,’ he explained.

But property turnover is rising and in July the firm sold 1,388 homes, some 18.9% higher than the number in June and 41.2% higher than in July last year. It is the highest sales figure for a July going back to 1999, and 4.5% higher than in July 2003, the year normally regarded as the most active on record.

The firm’s data also shows that new listings at 1,777 were the second highest for any month this year, the highest being in March at 1997, and were 27.3% higher than in July last year.

Meanwhile, total listings at month end at 2,802 were at their lowest since December last year, and Thompson said this will contribute to choice remaining tight during August.

Sales of properties in the million dollar plus category at 411 during the month were the second highest on record. There was also strong interest in property in the under $500,000 category, with sales numbers reaching 200 and representing 14.4% of all sales. In June sales of properties under $500,000 fell to 13.6% of sales.

‘With Spring approaching comparing market activity in the next few months with 2014 trading could be challenging, as in 2014 trading was significantly impacted by a 'wait and see' attitude that developed as we moved towards the general election. In the lead up to the election sales numbers slowed and prices did not recover until November,’ said Thompson.