An Auckland family home delivered its owners a gross profit of $780,000 after selling at auction last week for $2.18 million.
The vendors had originally bought the four-bedroom cross-lease house on Findlay Street, Ellerslie, in 2016 for $1.4m, with the listing agent noting that the property had, on paper, earned just over $100,000 a year.
Ray White agent Nick Lyus told OneRoof the resale profit was the biggest he had seen. “We’ve had maybe four or five resales in that time, but none have been nearly as dramatic a growth,” he said.
He said buyers had responded to the fact the house was “move-in ready” and in a good primary school zone.
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“It had a flexible floorplan, four bedrooms, or five with the office, so buyers could do blended families or work from home,” Lyus told OneRoof.
“We had 65 groups through the house, some were young couples buying with parental help, the parents moving out of Auckland but wanting a city base and getting their kids into a house, others upsizing from the typical three-bedroom, one bathroom house in Ellerslie.”
Lyus said while the previous owners had renovated the home, the vendors had upgraded the deck and the gardens.
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The property had a 2021 CV of $2.025m, but the seven bidders who took part in the auction had been coy on price.
Lyus said bidding started at $1.7m, but quickly passed $2m, with the final sale price exceeding his expectations and those of the vendors.
The buyers had sold their home a couple of months ago and had been actively looking since then, with Lyus noting that new listings were still tight.
“People have been keeping their powder dry for most of the year, but regardless of the election, life continues. We have a few more properties coming to market, but with only 50 days to Christmas, a few aren’t going to be listed until February,” he said.
The owners had upgraded the deck and landscaping. Photo / Supplied
Ray White auctioneer Ben East said that the market positivity was playing out in bigger auctions. “We’ve had some standout auctions. It’s not uncommon to see five, or six or seven bidders now,” he said.
“In Wellington two weeks ago we had a packed auction room and sold seven out of seven. And that’s a government town that is usually tender-based,” he said.
According to research by OneRoof's data partner Valocity, resale profits in Auckland have come under pressure as a result of the recent downturn.
While the vast majority of residential resales in Auckland in the third quarter of this year achieved a gross profit, the size of the gain shrank back to levels last seen in 2019.
The share of resales making a profit also dropped to a 10-year low of 86% – six percentage points lower than the same period last year and well below the 98% peak seen in 2021.
The median profit for Auckland resales in Q3 2023 tumbled 27% year-on-year to $325,000 while the median loss jumped 45% over the same period to $51,000, although this was smaller than the quarter before.
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