- Lower interest rates are driving increased home sales, with Harcourts agent Diego Traglia noting record transactions.
- Sales included quick turnovers, like a four-bedroom house in West Harbour selling for $940,000 in eight days.
- First-home buyers and investors are active again, with auction clearance rates rising to 50-60%.
Lower interest rates are leaving their mark, with freed-up buyers getting themselves a house for Christmas, says Harcourts agent Diego Traglia.
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His team of agents in Auckland’s north west sold 33 homes in November, which is a new record for the team and two homes more than the 31 sold in November 2021, at the peak of the market.
Back in 2021, media reports spoke of a frenzy of post-Covid buyers hurried into action because of FOMO (fear of missing out) but Traglia said the current market was not that.
Harcourts agent Diego Traglia says sales are up but not because of FOMO. Photo / Fiona Goodall
It was more about pent-up demand being actioned because of interest rate cuts on the back of two rounds of OCR cuts.
Sales included a four-bedroom, two-bathroom house on Oreil Avenue, in West Harbour, which sold for $940,000 after only eight days on the market.
A four-bedroom home on Semillon Avenue, in Henderson, sold under the hammer for $1.242 million with five bidders battling it out, and a five-bedroom house on Metcalfe Road in Ranui sold for $935,000, also in eight days.
It was like buyers had been let out of a cage, Traglia said. The buying was not every suburb, nor every price range but he said inquiries had picked up fast after the cuts.
To see the same level of activity in such different markets was fascinating. Back in 2021, the market was hot with developers buying up land, and they were paying big prices.
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A record price in Massey in 2021 was $2495 per sqm, but that had fallen to around $1100, Traglia said.
“Everyone was buying [in 2021] – first-time buying, second-home buying, third-home buying, investors, developers. It was the peak of the market and one of the best peaks of the market that New Zealand has ever seen from what I understand.”
The activity is nowhere the same in terms of FOMO and prices, but in terms of transactions it is on a par.
“I don’t think it’s a frenzy. People aren’t crazily trying to buy property because they think prices are going to go up 10% next year – although there is definitely an element of that,” he said.
Harcourts Cooper & Co managing director Martin Cooper: “You should get in before the rush starts." Photo / Ted Baghurst
Traglia noted that many of the buyers who had been on the fence, because they couldn’t really afford to buy, were now active in the market because interest rates had dropped.
December also started well with “quite a few kamikaze buyers”. They were buyers who called to view a property and within 24 hours the property was under contract.
Some people had pre-approval expiring or had sold their house already so were highly motivated to buy and wanted a house before Christmas, some wanting to be in a good school zone for next year.
“All of a sudden you’ve got your first home, or you’ve upgraded your location, or a better house. That’s nice – that’s a nice feeling to finish the year.”
Martin Cooper, managing director of Harcourts Cooper & Co on Auckland’s North Shore, said he had noticed more people at open homes and increased activity from first-home buyers and investors.
Agents on Auckland’s North Shore have seen an increase in buyer activity. Photo / Chris Tarpey
Those two groups were competing again at auctions, with clearance rates rising to 50-60%, although way behind the 90% seen post-Covid.
Buyers could see interest rates were tracking down, and that market would improve in the months ahead. “But I think there’s still a way to go. I think we need another 1% rate decrease over the next six months to really see a significant improvement in the market.”
The increase in interest was around the $800,000 to $2m range rather than particular locations on the North Shore, Cooper said.
That was positive but there was still a lot of stock on the market, with more coming. That meant anyone thinking of selling should get on with it and not wait for Auckland Anniversary Weekend or Waitangi Weekend to pass as was traditional.
“You should get in before the rush starts. I have anecdotal evidence of a lot of listings coming to the market and I’ve never seen a market where supply increases substantially and prices increase substantially, so if I was selling my house, I would go early.”
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