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Auckland house sale volumes plummeted in April to their lowest level for the month since the 2008 global financial crisis, as the average price slipped from a record high, according to realtor Barfoot & Thompson.

There were 664 sales in April, down 40 per cent from March and 30 per cent below April last year, Barfoot said.

The average sales price of $917,079 slipped 5.3 per cent from a record $968,570 in March, which typically marks the high point for prices in the first half of the year, and was 5 per cent higher than April last year.

The property market in New Zealand’s largest city has been on a tear as a shortage of housing coincided with surging population growth, prompting the Reserve Bank to introduce new macro-prudential tools to restrict highly leveraged mortgage lending.

That’s dented demand in Auckland and spurred buyers to look further afield, pushing up prices in the surrounding areas.

“It is a changed market from what we have been experiencing for a number of years and you have to go back nine years to find an April in which fewer homes were sold,” said Barfoot managing director Peter Thompson. “Buyers are being far more selective.”

The realtor noted that the decline in sales numbers was felt evenly across all price ranges.

 

By Tina Morrison
 
  • I don't think historically LVRs of between 70 and 80% can be considered 'highly geared' and it's no great surprise that lowering that to 60% makes it harder for both investors and developers to either purchase or create stock for the market.
    Making this hurdle higher doesn't seem to have had the desired effect either; the average house price in Auckland rose 2.6% in February 17 and another 2.5% in March, a 5% increase 5 months.

    That no doubt has an impact on sales as does the ability meet the equity demands of a 60% LVR, something rigorously (perhaps even ruthlessly) enforced by the banks. So, regardless of the macroeconomic efforts to manage this, the demand side remains strong given the inflationary reality and the supply side remains constrained…and we all know what the result of that is.

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