House market shows signs of recovery

4.00AM Sunday May 03, 2009
Joseph Barratt

A cautious murmur of optimism can be heard from some economists, property companies and estate agents: they are hoping that a slight upturn in house sales may herald the start of the recovery.

Two new reports, one from the Real Estate Institute and one from Crockers Property Group, offer the first signs that house prices may be rising.

The NZ Property Report, published by the Real Estate Institute and a group of big estate agencies, shows a sharp decrease in the number of properties listed for sale around New Zealand, an indication that the buyers' market of the past year may be turning to favour sellers.

And the Crockers report shows stronger sales in March, especially in Auckland, aided by population growth and expats coming home.

The reports come after Tony Alexander, the BNZ's chief economist, told buyers they shouldn't risk holding off in the expectation of lower prices.

The trends are far from certain, and most experts agree it's too early to confirm an upturn.

A dramatic decrease in the number of properties listed for sale in April suggests New Zealand could be turning to a sellers' market says the monthly NZ Property report released by
www.realestate.co.nz.

However the report's conclusions has been refuted by some property experts saying it's too early to tell.

The Real Estate Institute report shows 10,453 properties were listed in April, a decrease of 21 per cent from March and 34 per cent from the same time last year.

"The New Zealand property market has been a buyer's market for 18 months; however this is a significant drop in new listings," said Alistair Helm, chief executive of realestate.co.nz.

Glenda Whitehead, Auckland valuer for QV Valuations, said the market was a happier place than it had been in the past 12 months, but, "it's too early to suggest a dynamic shift".

BUYERS PAYING TOO MUCH
Mortgagee auctions are no longer the steal that buyers hope for.

Mortgagee sales have exploded in recent months as more struggling homeowners are pushed into selling, but experts say buyers are paying too much at the auctions.

A Barfoot&Thompson mortgagee auction this week attracted more than 70 people to the sale of four Auckland houses, and one North Shore section.

The Browns Bay section didn't sell, and the four houses sold for barely $50,000 below their
official valuations - hardly the fire sale that first-time buyers may expect.

Despite the large turnout, the auction room was eerily silent as the first bids were called for a four bedroom home in Dannemora.

The bidding slowly crept its way up to sell at $450,000 $60,000 under the official valuation.

The second property, another four-bedroom Dannemora home, sold for $445,000, while a third house just down the street sold for $415,000.

The fourth property, a one-level rear unit in Avondale, sold for $252,000.