After a record-low number of sales in February in many of Auckland's top suburbs, buyers are back in the market - and competing hard.
In St Johns, a four-bedroom home on Pyatt Crescent sold under the hammer last week for $3.006 million after 71 bids.
Barfoot & Thompson agent Chi Li, who marketed the renovated brick and tile home with colleague Carey Liu, said that the property had enough special feature to attract nearly 30 groups to the open homes and four registered bidders to the auction.
Although only two bidders put their hands up at the auction, competition between them was fierce, with the bids quickly passing the property's CV of $2.8m and the house being declared on the market at $2.81m.
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Li said the house had an attractive section next to a park and appealed to families drawn to some of the area's best schools.
She said buyers were back in the market. “Lots of people are looking, but they want a good price. They think now’s the time to buy, as prices are quite stable, they’re not dropping so they’re coming in. Vendors are more realistic, compared to last year,” Li said.
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Ray White Remuera agent Steve Koerber said that March sales were well up in his patch, and highlighted that more new listings were due to come to on stream in April and May, after the storms at the start of the year delayed preparations for sale. “I think March will be better than January and February combined. We’ve had time to sort out issues,“ he said.
Koerber has noticed clients across all price brackets re-thinking their housing budgets, though. “My gut feel, I wouldn’t say it is mortgage stress, but more of a down-trade. They have high expenses, so they’re saying ‘why have a house worth $6m, when I could happily live in a $4m one and have fewer expenses?’”
For those would-be vendors, Koerber has buyers with budgets of $6m who are ready to pounce. He also doesn't expect vendors with really good properties to be cutting their prices. “If you’ve got a really nice house with few objections, why would you discount?”
He said that most buyers have already sold, so can’t wait too long, and he is still comfortable bringing properties to auction to secure an unconditional sale. Vendors are prepared to offer long settlement variations if it means they get a bidder – and a sale - rather than take the risk of conditional contracts that may stretch out to six or 12 months to go unconditional. “That’s very dangerous.”
A three-bedroom townhouse in Benson Road, Remuera, billed as needing TLC sold for $1.41m. Photo / Supplied
UP Real Estate co-owner Barry Thom said that “the smart money” is realising now was a good time to buy. “People have got money because they’re smart, they recognise the timing is a good time to play in that $4m plus market. Obviously a) they’ve got to find something they actually want and b) they’re able to purchase because they’re not limited by the banks.”
The mid-range market in Remuera and surrounding suburbs was trickier. Barfoot & Thompson agent Alex Baker said that buyers in the $2m price bracket were thin on the ground. “If you’ve got one buyer, you’ve got a deal if there’s genuine interest. But there are not the queues of people lining up like they were in 2021,” he said.
Unlike two years ago, buyers and sellers have no sense of urgency now, and there were not enough properties around $2m to show buyers. “Some vendors are thinking things will get better, maybe after Easter or the school holidays or the election. They're just sitting on their hands,” Baker said.
Baker, with colleague Linda Galbraith, brought a 1980s, three-bedroom townhouse on Benson Road to auction last week and achieved a sale price of $1.41m.
The cedar house, on the market for the first time in 30 years, was advertised as a timeless design that needed updating. With a CV of $2.25m, it was good buy.
“But it does limit the market, the number of people prepared to do the work. We had steady enquiry and one bidder prepared to negotiate at auction and it sold under the hammer," Baker said.
A five bedroom renovated bungalow in Stack Street, Herne Bay, sold at auction for $6.81m. It had a CV of $7.5m. Photo / Supplied
Similarly, in Herne Bay, UP Realty agent Patrick McCarthy, is seeing a shift in sentiment.
His listing for a smartly renovated five-bedroom house on Stack Street sold under the hammer for $6.81m. That was under its $7.5m CV, but McCarthy said he was pleased with the result for the property, which was shown only to qualified buyers. He could not reveal the number of bidders.
McCarthy said he is telling vendors that the buyers are there, and astute ones are sensing the market pickup in the last month or so. He said buyers now are doing their calculations based on the higher interest rates and inflation, although many at this level are less dependent on banks.
“The sentiment out there has changed. Buyers are coming back out and seeing what they want. They’re being tough, but vendors are encouraged as there is very little stock.”
The $6.81m price for Stack Street showed there were buyers at that price range, but a shortage of suitable property.
“They want something completely done, fully renovated, they don’t want to take the risk of building themselves,” McCarthy said, adding that buyers were a mix of people who had already sold so were cashed up and desperate to buy, and those who still had a house to sell.
“People have been looking for a while, they’re sitting there and have not had much to choose from. People aspire to the northern slopes, even people from the other side of town who are moving back [to Herne Bay] after the kids have finished school.”
