A hefty combination of New year resolutions bringing people back into the housing market, and record low interest rates have created a heated February action in auction rooms that has’t been seen in years.
Ray White Papatoetoe principal and auctioneer Ted Ingram says it’s the most active February he’s seen in the last three years, as 2020 kicked off strongly for sellers and buyers.
“We’ve had three years of tough marketplace here. This February by far is the strongest with more listings and stronger bidding,” Ingram says.
Two weeks ago, in Papatoetoe the first auction sold for $60,000 over reserved price followed by $40,000 over reserve a week later, he says.
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There’s more than one buyer for almost every property with investors and first home buyers are very active in the auction room.
Investors and developers create competition in the room and place strong bids, he says.
“Interestingly, investors and developers and those trying to buy a do-up drove the price up until we sold to the first home buyer. They are not forcing anyone out of the market they are just determining a fair market value.”
Buyers are making big moves and taking advantage of interest rates being the lowest they’ve been in years.
The money is “dirt cheap” now, Ingram adds.
“People are thinking the interest rates are going up soon and start buying. I guarantee you, if the reserve bank put it up quarter of a cent, we would have had a dozen more buyers in the auction room today,” he says.
Auctioneer Aaron Davis of Harcourts says the auctions are in full swing nationwide and properties are selling above marked price.
This week he auctioned a townhouse in Epsom, which had a reserve of $1.78m and sold under the hammer for $1.96m.
“Who are we to try and price properties at the moment? There’s confidence back on the market and it’s right across the board. When I was working in Wellington and Christchurch this year – it's the same,” he says.
However, Sumich Estate Agents and Auctioneers owner Mark Sumich feels people are still recovering from New Year holidays followed by Auckland Anniversary and Waitangi Day.
“You get a good weekend of weather and everyone vanishes, they want to take advantage of good weather and a house search can slightly take a backwards step.”
However, between now and Easter he expects to see some “great hustles”.
“I anticipate there’ll be a lot of action. I have 40 auctions from now until the end of February and we’d be able to tell after that,” Sumich says.
