Auckland's housing market could be sailing into brighter waters as a result of the capital gains tax backdown and record low interest rates. Photo / Jason Oxenham
Auckland's housing market could be sailing into brighter waters as a result of the capital gains tax backdown and record low interest rates. Photo / Jason Oxenham
The capital-gains tax backdown and record low interest rates have triggered a selling frenzy in Point Chevalier, according to one Auckland real estate agency.
Professionals Pt Chevalier agent Ross Brader said his team was enjoying its biggest surge in sales in 25 years and was desperately on the lookout formore homes to sell.
The sales began rising when the Government announced last month it would not bring in a capital-gains tax and then surged once the Reserve Bank cut the Official Cash Rate to 1.5 per cent on May 8.
It led Professionals to sell eight homes in Point Chevalier - together worth $12 million - in five days from May 16 to 21, Brader said.
The company had also sold $72m worth of homes in five months this year, well up on the agency's normal yearly sales of about $100m.
"We've been doing Point Chevalier for 25 years, and we've never seen anything like that sort of surge in activity in such a short space of time," Brader said.
His comments come as most pundits are seeing signs the recent OCR cut and scrapping of the CGT has led to an uptick in house sales - although confirmation of this will have to wait until the release of more data.
"While it's too early to predict with complete certainty, early indications are that there has been a strong start to sales in May," Real Estate Institute of NZ chief executive Bindi Norwell said.
"However, we will have to wait until all the unconditional sales data is available in early June before we can accurately confirm this."
May's likely jump follows on from a disappointing April in which house sales were down 16.3 per cent on the same month a year earlier, according to REINZ statistics.
Auckland's housing market could be sailing into brighter waters as a result of the capital gains tax backdown and record low interest rates. Photo / Jason Oxenham
Prices, meanwhile, have been locked into a "Groundhog Day" scenario, with April's median price hovering around the $850,000 mark in each of the last three years.
Nick Goodall, the head of research for analysts CoreLogic, said there were signs the market's "weakness over the past six to nine months was dissipating in areas like Point Chevalier".
Auckland-wide homes were selling 1.6 per cent below their Auckland Council valuations, while Point Chevalier homes were selling 0.2 per cent above their CVs, CoreLogic data showed.
Part of the demand for Point Chevalier could also be due to its low number of houses listed for sale - just 25 last month, compared to 10,961 across the city as whole.
Other spots where recent slow sales volumes had turned and homes were selling at values closer to their CVs included coastal suburbs Herne Bay, Stanley Point and Devonport, Goodall said.
Loan Market mortgage adviser Bruce Patten said his business arranging home loans for house buyers had already been picking up in April due to record low interest rates, but in recent weeks there had been a further pickup from investors returning to the market.
Fellow Loan Market adviser Cameron Marcroft, who has run an office in Remuera for the last three years, said his team just experienced its best ever quarter of business thanks to a recent surge in house sales.
His record increase in customers had been mainly buyers snapping up homes across Auckland's central suburbs, he said.
Brader, for his part, is on the hunt for more homes to sell.
"If you look online in Westmere, for instance, there is hardly anything for sale, and we are rapidly running out of houses here in Point Chev," he said.
"If we could get 10 or 15 homes or bungalows that are on full sites that are in a tidy condition, we could sell them all in two weeks, but we just don't have the stock."
