The lifestyle property market is feeling pressure in Auckland, with August sales down 13 percent on July, according to figures from the Real Estate Institute of New Zealand.
The median price of lifestyle properties in the region also dropped, from $1.15 million in July to $1.14 million in August.
Figures show prices in the city are down 9 percent, or $110,000, on August 2018.
REINZ said there were 187 fewer lifestyle properties sold for the three months to August 2019 than for the three months ending July 2019.
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REINZ rural spokesman Brian Peacocke says that the drop in volumes through the winter is a result of toughening bank lending criteria, as they demand higher deposits, strong evidence of good cash flow to service the loan and less appetite for interest-only lending.
He also notes that in the Waikato – where volumes are also under pressure, with reports of a lack-lustre market – vendors are still asking too much, and not easing off their prices when buyers hit their affordability limits.
“But it is constantly on the move,” he says. “We’re coming off the winter period so numbers will increase, and vendors maybe find that another price will work for them.”
In north and west Auckland, Barfoot & Thompson lifestyle and rural property agent Rene Vos says that while listings in the likes of Kumeu have been lower in the last six months, they have picked up this month.
“It’s not just to do with spring or low interest rates making [lifestyle property] more attractive,” Vos says. “I think it is the mood. The auction floor this week was packed, most properties sold at a good selling price.”
Vos says that there is a shortage of good quality properties in the market. Lifestyle buyers are looking for quality homes and land that doesn't need work.
“They’re there for the life with kids and their family,” he says.
In Franklin district, LJ Hooker agent Fiona Clarke says that prices went up dramatically in the last five years around the area, but that vendors have not recognised the drop off in the last three months.
“They are still up there with their prices, but buyers know better and they’re not prepared to pay,” she says. “Days to sell can be up to 120 days, with properties re-listing for their fourth or even seventh month.”
REINZ figures for the whole Auckland region show average days to sell have crept out to 82 days, over 20 days more than Waikato, Bay of Plenty or Hawkes Bay lifestyle properties which averaged 58 to 64 days in August.
Like Peacocke, Clarke says banks are not making thing easy. She’s noticed bank-ordered building reports are finding more and more negatives, from things like tree-trimming and moisture issues, but in particular they are clamping down on lending for properties that have unconsented building or no certificate of completion on old building works.
“It’s the country,” she says. “Twelve or 15 years ago, who cares, everyone had sheds or garages. But you can’t get insurance on them, so banks won’t lend on them. You can’t get around it and you can’t ignore it.”
However, Clarke is seeing a spring up-tick as prices settle back and vendors realise they’ll be re-buying in the same, albeit lower, market.
“Listings are rolling in, but buyers are sitting on their hands,” she says. “In a 10 year cycle, we’re heading to the bottom, but in five years’ time, we’ll be up and away again.”
Check out OneRoof lifestyle properties here:
A luxury property in the heart of Coatesville on two hectares is being brought to auction October 17 by Ailsa McArthur of Bayleys, Albany. As well as the modern home, marble kitchen and wrap around patio with pizza oven and outdoor fire place, there are beautifully manicured gardens including a potager vege garden and orchard, studio, chicken coop, bush and stream and views across the valley.
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Fiona Clarke, LJ Hooker, is marketing a generous five year old Platinum-built home on Kaiaua Road with breathtaking views over the Firth of Thames. Sited on 9398 sq m of nor-east facing land, suitable for grazing or ponies, with a garden that’s a blank canvas and easy access to Pukekohe or the Coromandel coast.
Rene Vos and Eveline Vos of Barfoot & Thompson Coatesville have a modern family home on 1.5 hectares, complete with a swimming pool, gated entrance and mature trees, and the requisite barn for all the cars and toys. Asking $1.449 million.
