Auckland house market cools in hot January

By Ben Chapman-Smith

The average house price in Auckland fell about $23,000 last month. Photo / Janna Dixon
The average house price in Auckland fell about $23,000 last month. Photo / Janna Dixon

Auckland's housing market lost a little of its steam last month as the total number of sales and average house price fell, according to figures out today.

Real estate firm Barfoot & Thompson sold 100 fewer properties in January compared to December and the average sale price fell by just over $23,000.

Even so, the city's property market still experienced its most active January for five years, the firm said.

"As always occurs at the start of a new year, prices edged lower than those pre-Christmas, but January's average price of $600,754, is the first time we have achieved an average price above $600,000 in a January," said managing director Peter Thompson.

"Compared to last January, the average price is up 13.4 per cent."

In December, Barfoot & Thompson sold 920 homes at an average price of $624,015.

Although 820 sales last month was a drop, it was still the highest for a January in six years and 20.1 per cent higher than the same month last year.

Westpac senior economist Michael Gordon said Barfoot and Thompson's figures "threw up some curious results for the region's housing market in January".

"Our seasonal adjustments should be treated with some caution, given that January tends to be the low point for housing turnover, but overall the figures appear consistent with a maturing housing market upturn," he said.

"There are tentative signs that the rate of increase in house sales is flattening out - up 20 per cent on a year ago, compared to a peak pace of 45 per cent yearly in October - but again we can only make a tentative conclusion."

A reason for the drop in sales could be a lack of supply as at the start of the month, Gordon said.

"New listings were extremely low in December, followed by a sharp rebound in January.

"This is probably just a timing issue - taken together, the two months were much in line with the average number of listings over 2012."

A total of 1440 listings last month was Barfoot & Thompson's highest in a January for five years, and 39.7 per cent higher than January last year. The firm reported 697 listings in December.

"January is always one of our lowest months for new listings, but interest in selling rolled over into January as a result of the excellent prices being achieved pre-Christmas, and our agents have been active since the first business day of the year," Thompson said.

Thompson said he expected to see strong sales numbers and prices in the Auckland market over the remaining summer months.

Of total property sales, 383 went for under $500,000 and 68 sold for $1 million or more.

Gordon predicted a 9 per cent rise in nationwide house prices over 2013.

"Given that house price inflation was already running at around 6% by the end of 2012, our forecast actually implies that the housing boom is moving into a mature stage, with the rate of growth in both prices and sales starting to level out."

© Copyright 2014, APN New Zealand Limited

Assembled by: (static) on red akl_a2 at 26 Jul 2014 21:10:55 Processing Time: 765ms