Auctioneers say auction rooms are heating up with the February/March auction season already off to a strong start.
In Auckland, Campbell Dunoon, auction manager for Barfoot & Thompson, says this time last year there were 118 auctions booked for the next few weeks but this year there are 187.
That’s a big increase, he says.
“It’s been a good start. I think there were people holding back late last year and now the decision has been made, so that’s good - I think we’ll be having quite a busy February.”
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Dunoon predicts it could be standing room only in the auction room as the number of buyers outweigh the number of properties.
Last year ended with a real improvement in sales which bodes well for this year, he says.
“We had a good solid pool of buyers and we didn’t have as many houses as we would have liked to have offered and that resulted in some pretty nice price gains for our vendors.
“Whether that continues we don’t know, it’s a bit too early to tell. Generally speaking, we’re quite optimistic in the auction department, we’re seeing some good numbers at our auctions.”
A Harcourts real estate office in Auckland's North Shore. There has been strong buying activity in recent months in the city. Photo / Ted Baghurst
Aaron Davis, Harcourt’s national auctions manager, says agents have seen strong interest through open homes and a number of auctions have already been pulled forward which is a good indicator of activity and strength in the marketplace.
“We’ve seen a flurry straight after Christmas. We quite often see that but again it’s a good indicator the market’s got some strength in it.”
He expects auction rooms to be full with good activity and good bidding, as does Sam Steele, the national auctioneer for Bayleys who also says the numbers are significantly up on the same time last year.
Off to a good start
The year finished on a positive note and it’s looking like that will continue throughout the year, he says.
“Traditionally in January we see a lot of places that go to auction that are mainly in holiday destinations, whether that’s in Coromandel or up north or Waiheke and places like that.
“As we hit next week, as we get into February, that’s when the majority of stock does come to the market, because people have made a decision while they’ve been away, or they’ve made a decision before Christmas time ‘we want to buy something, we want to get into school zones’.
“It’s usually the time of year that people do make decisions, that they do like to move on.”
Dunedin and Christchurch, too, are seeing auctions off to a good start.
Mark Stevens, of Bayleys, says the Dunedin market is so positive at the moment there are a lot of buyers for every house.
“Auctions are a good way of getting the maximum price but also being quite transparent for the purchasers, too.
“They can come in and see what everyone else is doing rather than make an offer anonymously from home and hope they’re one of the five people and hopefully they get it.”
He expects standing room only in the auction room, too, saying that’s how it has been for the last year or two in Dunedin anyway.
Exceptional prices
And in Christchurch, Roger Dawson, an auctioneer for Harcourts, says auctions are already underway with some exceptional prices gained.
“We don’t normally get cranked up until February and March so it’s an indication it’s going to be a good year ahead.”
Of three auctions last week, three of the properties sold, two for way more than anticipated.
“There was one that had some real scarcity value. It was the old vicarage in Akaroa and it had been in continuous use for 103 years until the vicarage put it up for auction last week and there were probably 10 bidders in the room and it got an exceptional price.
“We thought it might give $1m a fright but it sold for $1.305m in exceptionally competitive bidding.
“Then there was a townhouse in Fendalton that everybody thought was probably somewhere in the early sixes and it sold for $695,000.
“Those are just signs that people pay good money for the right property if it’s out there.”
A shortage of stock may be reflected in the competition for properties and Christchurch is especially short in the under $500,000 first home buyer range, he says.
“There are lots of people who are cashed up, approved and ready to buy but they can’t find the stock.”
Certainty of sale
In Wellington, however, auctions are not heating up - Ray White licensee Peter Scott says the capital doesn’t have a tradition of selling by auction.
“Wellington is a predominantly tender deadline process, and that’s most agencies. Otherwise they do a BEO (buyer enquiry over) or in other words there’s a price indicator.”
Scott says homeowners prefer the tender process because they believe it works in their favour.
While auctions give sellers certainty of sale with an unconditional bid (if there is one), Scott says, “my comment to that would be, the person that bought it - would they have gone more?”
In the tender process people have to present their best offer without knowing what other people are bidding, and that best offer might be a lot higher than the top bid at auction.
Wellington, however, is still off to a slow start with low listings, despite plenty of interest from buyers, he says.
