The auction room at Ray White Manukau was packed last week, with seven out of 11 properties selling under the hammer.
Branch manager Tom Rawson, who is also a director of the agency, says the strong turnout and high number of sales indicates buyers and sellers now have their finger on the pulse of the market.
A fast-moving market and the big demand of the last couple of years meant buyers were pushed to pay more for properties, but the market has changed and now sellers are saying “oh well, that’s the market, we’ll take that”.
“It's not really moving that fast up or down, it's just kind of stagnant and so people are meeting at that point, middle ground, which is good.”
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Rawson says his agency’s success rate is high because agents are making sure owners understand the auction process and also because owners want the cash unconditional results an auction brings.
He thinks it’s also because buyers are ready to buy, and says that partly comes down to getting preapprovals which can be hard-fought for and have a time limit.
“When you have your preapproval you’ve got a three-month window typically to go and buy something so people are out there with genuine intent which has been lacking over the last few years.”
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If people wait, interest rates could go up and they will have less to spend: “Your borrowing power goes down, your serviceability goes down - everything goes down.
“You can’t wait and see any more, you’ve just got to go out and pull the trigger.”
Those who are out shopping are finding the prices are acceptable.
“I think they feel everything is at a bit of a discount from where it was selling, which is more just normal market prices now.”
At this week’s auctions properties averaged 10% under CV compared to the previous week which averaged 23 per cent below CV, he says.
Two properties which sold under the hammer were closer to their respective CVs: one on Lissleton Drive, in East Tamaki, which sold for $1.35m, and another on Hawkdun Drive, in Mission Heights, which sold for $1.47m.
Rawson says that’s because those are in areas where there are plenty of comparable properties which makes the CV more accurate.
Some other properties in Manurewa had 700sq m of land and the council had put a “massive value” on land but the developers are no longer out buying.
Instead, home buyers were buying but the price was not reaching the CV because they are not developers.
This four-bedroom home on Lissleton Drive, in East Tamaki, fetched $1.35m under the hammer. Photo / Supplied
He cites a property on Stratford Road, in Manurewa, which sold for $872,000. That was well above the $750,000 reserve but lower than the $1m CV.
The vendors were ecstatic with the price, Rawson says: “They were stoked. Some people look at the CVs and go wouldn’t it be nice if our property was worth that but realistically we know it’s not, it’s just we’re getting rated on that value.”
It’s nice to see home-buyers being successful again, he says.
“In the past they were like ‘oh, there's no point me turning up to auction, I'm going to get beaten by a developer’.
“There's every reason to turn up to an option for a home buyer because that competition, that side of it, is not there unless it's a genuine development site, whereas everything was being treated as a development site for the last three years – now, it's like turn up because you've got a real chance of buying it.”
Marian Tolich, auctioneer for Barfoot & Thompson, says she also had a good week, selling four out of seven properties, three under the hammer and one later to the top bidder.
One auction was “very lively” with the property selling above the $1.85m CV and also above the reserve.
The single-level brick and tile fully renovated home at Mahina Place, in Te Atatu, had generated a lot of interest and sold for $1.87m with three bidders in the room.
“It just went crazy, it was on the market for $1.8m and went from there, it was very active bidding.”
This family home on Blockhouse Bay Road, in Blockhouse Bay, sold for $1.18m. Photo / Supplied
Another family home, on Blockhouse Bay Road, in Blockhouse Bay, sold for $1.18m, just under its $1.25m CV and what it last sold for in April 2022.
The property, whose listing declared “Urgent sell – must be sold”, shifted after the owner adjusted the reserve and Tolich says owners who are prepared to move will get the sale.
“There seems to be a little bit more, what’s the word, enthusiasm for that whereas last year I guess people were like ‘no, no, no’ and now vendors have got the message, vendors realise it's not last year's prices, it's a year on.”
Another first home buyer level property on Rosier Road, in Glen Eden, sold for $738,000, under the $970,000 CV.
The house was in good condition and represented excellent value, Tolich says, who says negotiations were continuing on some of the properties that were passed in.
She says there is a trend back to auctions as people have returned back from Christmas and want to get on with their lives, but she says most have to sell their own house first before they can buy as it is hard to get bridging finance at the moment.
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