Auckland's biggest real estate agency says the city's housing market is "edging towards a price decline" for the first time in a decade, with prices falling in the last year.
Barfoot & Thompson, with more than 40 per cent of Auckland's housing market, has just released its monthly data and that showed a clear fall between 2017 and 2018, it said.
"The median sales price for 2018 was $836,792, down 0.8 per cent on that for 2017. This is the first time in 10 years the median price has fallen," the agency said, noting how 2017's median price was $843,582.
"For the first time in a decade the Auckland residential property market is edging towards a price decline," the agency said.
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The market was indecisive about the direction it was heading in.
A range of factors contributed to market uncertainty at year end. These included non-New Zealand residents being restricted from buying certain categories of property, the reported major decline of property prices in the major Australian cities, the potential for capital gains to be applied to investment properties in the future and concerns over world economic stability, in part caused by the trade friction between the United States and China," Barfoot said in a commentary this morning.
The average 12-month sales price for 2018 at $929,910 is up on 2017, but by only 0.4 per cent. Earlier in the year, it was tracking between 1 and 2 per cent above 2017's average price. A stand out feature in 2018's sales data was the significant increase in the number of sales made in the under $500,000 price category. In 2017 property sales in this price category represented 8 per cent but last year it was 11.4 per cent, Barfoot said.
More apartments, terraced housing and townhouses were for sale, giving first-time buyers and those on lower incomes better access to the market, Barfoot said.
December's average price was $937,792, 504 sales were made last month, down 25 per cent on the 674 sold in December, 2017. Barfoot listed 555 new properties in December, down 2.8 per cent on the 571 listed in December, 2017.
Peter Thompson, Barfoot managing director, told the Herald last month that this year was going to see a continuation of good property sales being made with house prices remaining similar to what they are currently.
There was a chance of a slight market correction this year as it was becoming more of a buyers' market compared to this time last year, he said.
Days on market was lengthening and more sales were conditional on getting finance from banks, he said.
Kim Mundy, economist at ASB, said the Barfoot figures highlighted "a very soft end to 2018 for the Auckland housing market. We are expecting to see more soft data results over 2019".
"New house listings also contracted in December, suggesting that sellers are still taking a cautious approach to the housing market," she said.
"The rebalancing in the Auckland housing market is expected to continue into 2019, with higher inventory levels giving prospective buyers the luxury of both time and choice."
Sales activity was expected to remain muted heading into the new year, she said, adding that tax changes and the ban on foreign buyer would affect demand, but that positives included population growth, easing LVR restrictions and still-low interest rates.
"These supports are likely to limit any further price falls we may see in the Auckland housing market over 2019," she said.
