Only a third of nearly 150 homes sold under the hammer during three days of auctions at Auckland's biggest real estate agency this week, suggesting new mortgage-lending rules have cooled the buoyant market.
Barfoot & Thompson's chief said some properties sold prior to auction, giving a clearance rate of about 48 per cent - but that was still a decrease on the 80 per cent rate two months ago.
Peter Thompson put it down to fewer first-home buyers, due to the loan-to-value ratio restrictions, vendors inflating their prices and more stock.
The Herald observed that auctions for homes in the central suburbs, West Auckland and on the North Shore in Barfoot's Shortland St city office and the Bruce Mason Centre in Takapuna on Wednesday, Thursday and Friday.
Of the 148 properties on offer, just 54 (36 per cent) sold, while 94 (64 per cent) either received no bids or did not meet the vendor's reserve.
Mr Thompson said some house sales were negotiated after auction, giving North Shore a clearance rate of 44 per cent and central and West Auckland a rate of 48 per cent.
"There has been a significant fall off. I think the LVR has had an impact, but it's a combination of more choice for buyers and I also think some vendors are trying to get on to the bandwagon of such high success rates that they're most probably setting their reserves at too high a price.
"It wasn't uncommon for buyers to say 'I'll go to $520,000, even though I said my limit was $500,000', whereas I think now they're not doing that sort of thing.
"With the LVR and the limit they can borrow, they don't actually have that extra flexibility to go that extra $20,000 or $30,000 that may have secured the property."
House-hunters spoken to by the Herald were looking for their second home or investment properties.
A two-bedroom property at 211 Marua Rd in Mt Wellington got no bids on Wednesday, while a five-bedroom home at 9 Maxfield Pl in Epsom on a 991sq m section was passed in at $1.9 million on Thursday.
Mia Lo and her husband Wayne, both in their 30s, were the only bidders on a five-bedroom house on Kenmure Ave in Forrest Hill.
They opened bidding at $850,000, but the auctioneer said the 860sq m property would not go for anything under $1 million so it was passed in.
"It was higher than what we expected," Ms Lo said.
The couple have lived in New Zealand for several years and are looking to sell their first home, a three-bedroom property in Albany, which they bought five years ago for $445,000.
They had been attending auctions for the past two weeks and Ms Lo said there were few to no bids on most homes.
"We heard that two months ago people were buying houses like they were buying noodles, but now there are not many bidders around."
BNZ chief economist Tony Alexander's survey of 250 agents last week showed a net 28 per cent of agents reported that auction clearance rates had declined.
"With a lot of buyers taken out of the market for now, the agents are finding that auctions are not necessarily the most successful for selling properties at the moment so there's a bit of a movement back towards a direct bidding process, getting finance in place. The first-home buyers are hesitating to attend auctions because they can't be certain that they'll be able to actually get finance on the place."
He said some investors were pulling back, which was "not what I expected to see".
"They are uncertain about what the impact is going to be on prices in the very short term. I'd view this as just a wee bit of a lull in the market."
The latest Real Estate Institute figures show 43 per cent of all house sales in Auckland were by auction last month when the new rules came in.