Residential Market Report.
OCTOBER
2024
04. Market CommentWe’re Holding Our Collective Breath
08. Mount Roskill Sales Statistics
July 2024
14.
Article – Tony Alexander: Inflation drop better than expected but don’t bet on a 0.75% rate cut
06. Sandringham Sales Statistics July 2024
12. Caset Study & Auction Update with Cameron Brain
16. Our month in Review Top Stories & Events from the City Realty Group
22. Article – Kelvin Davidson: The buyers making a surprise comeback - should housing market newbies be worried?
28. LoanMarket Update
32. Why choose us?
24. Property Management Update
30. Marketing your home
34. Ray White Sandringham & Mount Roskill team
We’re Holding Our Collective Breath.
Director of City Realty Group, Daniel Horrobin says: “There are sufficient positive indicators now to instil confidence the market generally is gaining momentum, but still we hold our breath”.
Our very own Loan Market partner Jamie Maclennan remarks “As last month’s cut in the official cash rate (OCR) continues to wash through the finance and property markets, all eyes are on the Reserve Bank of New Zealand’s (RBNZ) next monetary announcement on October 9.” Early in September, economist Tony Alexander reported positive signs. “This is my first column for the month, which means I have in hand the results from my survey of real estate agents around the country. The data show us that the upward momentum in residential real estate, which was apparent even before the August 14 easing of monetary policy, has strengthened. Whereas two months ago a net 35% of agents said that they were seeing fewer people attending open homes, now a net 42% say they are seeing more. The late-July result was 11%.”
“Startling proof to support the above survey results,” adds Daniel, “are our own open home visitor numbers in the Central City. September’s touch over 400 open home visitors was up a staggering 98% on August”. Realestate.co.nz identified key areas of interest. “Unprecedented price stability offers certainty for buyers and sellers. In fact, with average asking prices remaining flat, it marks the longest stretch of price stability since records began 17 years ago. Spring stock levels are at the highest they have been in a decade.”
“In our Central City market,” says Daniel, “the number of properties available for sale on Trade Me has finally shown signs of increased activity with numbers cracking the 600 mark after dipping somewhat over the winter months. That is likely a result of a general growth in confidence given recent events and maybe the prospect of warmer months ahead.”
Tony Alexander’s mid-month survey of mortgage brokers provided an interesting insight. “A net 51% of brokers report that they are seeing more first-home buyers looking for
advice, while a net 33% say there are more investors in the market. Two months ago these results were -7% and +9%, which tells us that in response to the change in the interest rate outlook, it is young buyers who feel more greatly motivated to consider a home purchase.”
“Are investors back?” queries Daniel, focussing on a core element of our Central City apartment market. Interest.co.nz reported on 25 September: “Investors had a bigger share of mortgage money than first home buyers for the first time in about two-and-a-half years last month.” There is however still some pain out there as economic conditions and interest rates continue to prove a challenge.
Earlier in the month it was reported:
“Mortgagee sales have hit a post-Covid high in new data released to OneRoof, according to the latest figures from the Reserve Bank (RBNZ).”
Analysis by property insights firm CoreLogic found there were 189 mortgagee sales in the 12 months to the end of June this year – up 81% on the previous 12 months and more than triple the tally for all of 2022.”
On a more positive note, Daniel says: “We have nearly 30 auctions already booked for October in our Queen Street auction room and counting. That is a very positive sign, reflecting an REINZ report earlier in the month confirming signs of increased confidence, optimism and activity compared to the previous year. In fact, the number of auctions we have booked already for October is nearly double those we conducted in the same month a year ago.”
In the tenancy space, Tony Alexander reported in a NZ Herald OneRoof article on 25 September:
“Good tenants are now a lot harder to find than before. At this time last year a strong net 24% of landlords reported that they were finding it easy to secure good tenants. Now, a record net 22% say that finding such people is hard.”
Total Sales
September 2024
12
September 2023
16
There was a -12% decrease in the total number of sales year on year.
Total Sales Value Median Sales Price Median Days On Market
September 2024
$17,765,500
September 2023
$18,817,273
There was a -5% decrease in the total sales value year on year.
Source: REINZ
September 2024
September 2023
September 2024
$1,302,500 79.5
September 2023
$1,268,500 38.5
There was a 3% increase in the total median sale price year on year.
There was a 106% increase in the total median DOM year on year.
Sandringham Recent Sales.
Mount Roskill Market Statistics.
Total Sales
September 2024
34
September 2023
44
There was a -22% decrease in the total number of sales year on year.
Total Sales Value Median Sales Price Median Days On Market
September 2024
$35,249,494
September 2023
$44,339,600
There was a -20% decrease in the total sales value year on year.
Source: REINZ
September 2024
$892,000
September 2023
$939,000
There was a -5% decrease in the total median sale price year on year.
September 2024
37
September 2023
47
There was a -21% decrease in the total median DOM year on year.
Mount Roskill Recent Sales.
Some of our Recent Sales
386
636 Open Homes Conducted
City Realty Limited Licensed (REAA 2008) Properties Opened
1186 People Met
Average Number of Buyers Through Open Homes Auction vs Private Treaty 4.40 Auction
1.83 Private Treaty VS
AUCTION PROPERTIES SAW 2.4x THE AMOUNT OF BUYERS THROUGH THE OPEN HOMES COMPARED TO ALL OTHER SALE METHODS. (SEPTEMBER 2024)
City Realty Group Auction Report.
The recent drop in the OCR has sparked a surge of optimism in the auction market, with more bidders registering in the first six weeks of Spring.
This renewed confidence is beginning to show in our numbers, as our Auction Clearance Rate for September saw a modest increase compared to August, now sitting at 48.2%. While this improvement may seem slight, it reflects a growing sense of momentum in the market.
Another positive sign is the reduction in the Average Days to Sell an Auction Property, which has dropped to 44 days. This faster turnaround is a welcome change, especially as we move deeper into the traditionally busy Spring period.
Open Home attendance has also surged, with September figures showing a 56% increase. Our team met with 1,156 people across our listings, leading to heightened activity at our auctions. This increase in interest was particularly evident in the apartment and residential markets, where we achieved several pleasing results.
With less than three months remaining in 2024, we are encouraged by the strong pipeline of auctions already booked for December and even our first auction set for January 2025. As we look ahead, it’s clear that the market is responding well to the recent changes, and we anticipate a busy and successful close to the year.
Stay tuned for more updates as we continue navigating this dynamic market!
“Our Auction Clearance Rate for September saw a modest increase compared to August, now sitting at 48.2%.
& Auction Manager 027 424 1782 cameron.brain@raywhite.com
Tony Alexander: Inflation drop better than expected but don’t bet on a 0.75% rate cut
And why it’s time to ditch unhelpful language around cut sizes.
ANALYSIS: Heading into the September quarter inflation release, some people had been getting quite excited with their push for the Reserve Bank to cut the Official Cash Rate 75 basis points at the next meeting on November 27. Were this to happen, it would be an extra positive boost for growth in the economy through 2025 and of course the strength of the upturn now underway in the real estate sector.
So, was the Consumers Price Index outcome enough of a surprise to justify a further acceleration in the pace of policy
easing?
The annual rate of inflation dropped to 2.2% from 3.3%, which is within the Reserve Bank’s 1-3% target band and about average for the past three decades. So far, so good.
The 2.2% result is also less than the 2.3% expected by the Reserve Bank so there is no problem there.
But the difference is small and when we look at some of the details there is no reason for believing that NZ inflation risks
Young first-home buyers have responded strongly to the cut in interest rates. Photo / Fiona Goodall
falling below 1%.
In particular, we need to look at the difference between tradeables and nontradeables. About 40% of the CPI basket of almost 650 things are traded across the border or have their prices heavily affected by prices overseas. These tradeables prices fell 0.2% in the September quarter and 1.6% for the year. We are importing deflation.
But the more important measure is nontradeables for which the quarterly price change on average was a rise of 1.3% following a 0.9% increase in the June quarter and 1.7% rise in the March quarter. This measure of what is happening in New Zealand to the prices of things monetary policy can eventually influence rose 4.9% this past year. This is too high and an easy challenge to those who might say the economy is so munted local inflation has died. It has not and it remains too strong.
So, barring some fresh horrible news for
the local or world economy, we can still reasonably expect another 50 basis point cut in the Official Cash Rate in November, taking it to 4.25%. After all, in November 2022 the Reserve Bank increased the cash rate by 75 basis points, following the CPI for the September quarter coming in 0.6% higher than it expected. This latest result is only 0.1% lower than included in the most recent Monetary Policy Statement.
But consider this. When the 50 basis point cut happens one imagines people will use the same terminology that was used recently to describe the October 9. Namely, “slashed” and “massive”.
Those words were wrong last week and they will be wrong again late in November. Since the Official Cash Rate was introduced in April 1999, it has been cut 28 times. Two of these cuts reached 150 basis points, but the average cut has been 46 basis points. Therefore, October’s was only average –not massive.
- Tony Alexander is an independent economics commentator. Additional commentary from him can be found at www.tonyalexander.nz
@raywhiteaucklandcentral
@raywhitewynyardquarter
@raywhitesandringham
@raywhite.mtroskill
Ray White Mount Roskill turns One!
We’re incredibly proud to celebrate one year of serving this amazing community.
Here’s to many more successful years ahead!
And the winner is...
List Today. Explore Tomorrow!
Ray White Mt Roskill gave away $1,000 towards a dream trip.
Congratulations goes to Ching-Han Su
Celebrating Big Wins!
We’re beyond proud to be ranked as one of the Top 8 Ray White offices in the country—a massive achievement for our Auckland Central team.
And a special shoutout to the legend himself, Habeeb, who took home the International Customer Service Award for the third year running!
We marked the occasion with a happy hour at Somm by the waterfront, surrounded by our epic team who are ready to smash even more goals this year! Here’s to success, dedication, and the incredible people who make it all possible.
Auction Action!
Auction Manager Cameron Brain has been out and on site calling our spring Auctions this month.
38 Hukanui Crescent, Ponsonby is an exceptional freehold, three bedroom, two bathroom with two carparks. Created for families & professionals with remarkable taste, this home offers unrivalled convenience and lifestyle. Pictured Right.
Trends and TradeMe Property
We welcomed TradeMe Property to our weekly sales meeting to share the latest property trends.
Pictured: Our Ray White Auckland Central weekly sales meeting.
Auction Sucess for Luke...
Going. Going...Gone at 48 Kitchener Road, Sandringham
Congratulations to the new owners— enjoy your dream home
Ray White Mount Roskill celebrate Diwali
May, Pantea & Shubhrta celebrated Diwali with the community by sponsoring the Children’s Area at a recent local Diwali festival.
It was wonderful to see so many smiling faces and to share in the joy of this beautiful celebration. We’re looking forward to more Diwali festivities to come!
Quiz Night with Sandringham
Our Ray White Sandringham team were out and about at the Edendale School Quiz night.
Kelvin Davidson: The buyers making a surprise comeback - should housing market newbies be worried?
The five things you need to know about the housing market this week.
1. Keeping an eye on mortgaged investors
The latest CoreLogic Buyer Classification data showed that first-home buyers remain a strong presence in the market, with around 26% of property purchases in September. By contrast, activity by relocating owner-occupiers (movers) is still a little quiet (25%) by past standards, but perhaps the group to keep an eye on is mortgaged multiple property owners. That group has been edging higher in the past 4-5 months (rising to a 23% share in September), presumably driven at least in part by interest deductibility being back at 80% for all properties from April 1 (and 100% next April) and reduced deposit requirements from July 1. To be fair, mortgaged MPOs will still typically be topping up a new rental purchase quite significantly, but as interest rates fall that
equation will start to look more favourable. On the flipside, the faster mortgage rates drop, the sooner the debt-to-income (DTI) ratio restrictions will become more binding. But new builds are exempt, so that’s where the focus could shift for more investors, with many in that game already.
2. Construction costs are still pretty flat
The latest Cordell Construction Cost Index – which covers wages and the cost of materials (excluding land) – showed a 1.1% quarterly rise in a standard house-build in September (after a 1.1% fall in Q2), leaving the annual change at only 1.3%. It’s hardly surprising that costs have flattened out, given that the wider construction industry is still in the doldrums, amidst caution on the part of households and the weaker
Property investors have lifted their game in recent months, and their share of the market rose to 23% in September. Photo / Fiona Goodall
jobs market – not to mention lots of choice for buyers amongst the stock of existing listings.
That said, I’m just starting to hear whispers that a little more optimism is starting to re-emerge in the construction sector, and there are certainly some decent reasons to think 2025 could be better. Obviously, lower mortgage rates would be part of that story, but the DTIs could also encourage more demand for new-builds, giving developers a confidence boost.
3. Inflation finally falls below 3%
Stats NZ reported last week that the headline inflation rate was 2.2% in the September quarter, down from 3.3% in Q2, and the first time in the 1-3% target range since early 2021. Most of the work has been done by tradable/imported factors (-1.6%), whereas the non-tradable/domestic side of the equation was still 4.9% – held up by continued growth in rents, council rates, and insurance premiums. All of this was broadly in line with expectations, so it might not change the Official Cash Rate outlook too much, with another 50 basis point cut still looking likely on November 27. But with non-tradable inflation at high
levels, the Reserve Bank will continue to watch each piece of activity/price data as it comes to hand.
4. Banks continue to get a bit busier
On Thursday, the Reserve Bank will publish September’s mortgage lending figures, covering house purchase loans, top-ups, and bank switches. These numbers have been gradually rising for several months now – albeit from a low base – driven by more people buying houses, but also a willingness to jump across to a different bank (often for a cashback). These patterns are set to be repeated in September’s figures. There’s already been evidence of a quick response from investors to the deposit requirements falling from 35% to 30% (for existing properties) on July 1.
5. Economy still just bumbling along?
We’ll also get more real time economic data this week, including the NZ Activity Index for September on Wednesday and ANZ consumer confidence for October on Friday. Unfortunately, there seems a decent chance that these will continue the sluggish message of most indicators lately.
CoreLogic chief economist Kelvin Davidson: “Housing affordability could be a significant problem for a while yet.” Photo / Peter Meecham
1. Lack of Communication. Effective communication is the backbone of good property management. If your property manager is slow to respond to your calls or emails, it can lead to unresolved issues and increased frustration. Prompt communication ensures that problems are addressed quickly and that you’re always in the loop regarding your property.
2. High Repair Costs. Unexpectedly high repair costs can eat into your rental income. If you notice that maintenance and repair expenses are consistently higher than expected, it might be a sign that your property manager is not sourcing cost-effective solutions or is overcharging for services.
3. Late Rent Collection. Timely rent collection is crucial for maintaining a steady cash flow. If your property manager frequently reports late rent payments without taking effective action, it can create financial strain. Consistent late rent collection might indicate poor tenant screening or a lack of follow-through with tenants.
4. Vacancy Delays. Long vacancies can lead to significant revenue loss. A good property management company should have strategies in place to minimize the time your property sits empty. If you find that your property is vacant for extended periods without a good reason, it’s time to reconsider your current manager.
5. Non-Adherence to Laws. Compliance with local laws and regulations is non-negotiable. If your property manager is not keeping up with Auckland’s tenancy laws or fails to ensure your property meets legal standards, you could face fines or legal action. Legal compliance is essential to protect your investment and avoid potential liabilities.
6. Lack of Inspections. Regular property inspections are vital to maintaining the condition of your property and identifying potential issues early. If your property manager isn’t conducting inspections as often as agreed, it can lead to unnoticed damage and increased repair costs down the line.
7. Tenant Satisfaction. Unhappy tenants and poor tenant-manager relationships are red flags. Frequent complaints about management, maintenance delays, or poor service can indicate that your property manager isn’t meeting tenant needs. This can lead to higher turnover rates
and difficulty in attracting new tenants. Positive interactions and attentiveness are crucial for tenant retention and maintaining your property’s reputation.
8. Inefficient Repairs. Timely and efficient repairs are essential for tenant satisfaction and property upkeep. If you notice ongoing maintenance issues or recurring problems that aren’t being resolved properly, it’s a sign that your property manager might not be handling repairs effectively.
9. Unreasonable Fees. While property management services come at a cost, the fees should be reasonable and transparent. If you’re noticing unexpected charges or feel that the fees are too high for the level of service provided, it’s worth comparing other options in the market.
10. Performance Reports. Regular and detailed performance reports are essential for keeping track of your property’s financial health and management activities. If your property manager fails to provide clear and comprehensive reports, it can hinder your ability to make informed decisions.
11. Lack of Proactive Management. A good property manager should be proactive in preventing issues rather than just reacting to them. This includes anticipating maintenance needs, staying ahead of legal requirements, and continuously looking for ways to improve property performance. If your manager is always in a reactive mode, it might be time for a change.
12. Trust Issues. Trust is the foundation of any successful relationship. If you find yourself doubting the integrity or honesty of your property manager, it’s a significant red flag. Trust issues can stem from various concerns, including financial discrepancies, lack of transparency, or unfulfilled promises.
Choosing the right property management company is essential for the success of your rental property. A reliable company can help maximize your rental income, keep your property in excellent condition, and ensure that tenants are happy.
Here’s what SuperCity Property Managment has for Rent this month.
Please see below our latest, available properties for rent. If you have any friends or family looking for accommodation please pass this list on to them!
$800 per week
66/3 Burton Street, Eden Terrace 2 Beds / 2 Bath
$620 per week
1/179 Landscape Road, Mount Eden 3 Bed / 1 Bath
$780 per week
L2/47 Union Street, Auckland Central 2 Bed / 2 Bath
$530 per week
L12/135 Victoria St West, Auckland 1 Bed / 1 Bath
$1,500 per week
L16/6 Princes Street, Auckland Central 3 Bed / 2 Bath / 2 Car
$500 per week
L15/430 Queen St, Auckland Central 2 Bed / 1 Bath
6/8 Shackleton Road, Mount Eden 1 Bed / 1 Bath FOR RENT FOR RENT FOR RENT FOR RENT FOR RENT FOR RENT
$570 per week
$1,300 per week
L15X/1 Greys Ave, Auckland Central 3 Bed / 2 Bath / 2 Car
$850 per week
1207/1 Greys Ave, Auckland Central 1 Bed / 1 Bath
$480 per week
L15/72 Nelson St, Auckland Central 2 Beds / 1 Baths
To view a full list of available properties for rent follow this link or scan the QR Code on this page.
jamie.maclennan@loanmarket.co.nz
Prior to the announcement we had the Federal Reserve in the US cut its rates by -0.50% and the Bank of London is talking about significant cuts to come as well.
All the banks have cut their rates several times since August 14th, and we expect more cuts to come now.
RBNZ Doubles down with 50 basis points cut of Official Cash Rate
It’s been an action packed few weeks since the Reserve Bank made its first cut in the Official Cash Rate in this current easing cycle.
So what can we expect?
This week we will get CPI Inflation data for the last quarter, and based on the commentary from the RB, we expect the inflation rate will
be back within the 1-3% band they are after. (I expect the RB may have had this information before the recent release based on the announcement).
This will make the next two announcements very interesting:
OCR Update on November 27th
OCR Update on February 19th, 2025
Why did they cut by -0.50%?
We wondered whether the Reserve Bank would go “hard and fast” or “slow and steady”?
This clearly slows the RB is now going hard and fast and we now expect they are likely to cut again in November
bringing an early Christmas present. Unfortunately this will be too little too late for some businesses who have been after this for some time.
How low will rates go?
Our best guest is we can expect at least another 1-1.5% drop in the OCR over the next 6-12 months.
Riding rates down is the easy part, picking the low point is the challenge, so don’t wait too long in making a decision to consider a longer term fixed rate. We expect this could be anywhere from April - October of 2025.
Marketing your home.
A COMPREHENSIVE MARKETING STRATEGY TO REACH ACTIVE & PASSIVE BUYERS.
The marketing strategy is designed to reach the breadth of the active and passive buyer pool in the most effective manner, based on their Media consumption.
Our marketing strategy comprises of 3 key components; property portals, social and multi-channel digital strategy and print media.
Property Portals.
PRIMARILY ACTIVE & SOME PASSIVE BUYERS
There are 3 key portals, TradeMe Property, Realestate.co.nz and Oneroof.co.nz.
Property Portals generally attract active byers in the market, OneRoof has a unique position as it reaches both active and passive property buyers due to the diversity of information it has on the platform including property
Digital Marketing.
ACTIVE & PASSIVE BUYERS
The Ray White City Realty Group has introduced a state-of-the-art digital solution that is powered by artificial intelligence to reach the breadth of the active and passive buyer pool across social media and multiple digital channels, including news and other high traffic websites. The programme is fully automated in the back end, it creates an audience
Print Media.
listings, estimated property values, market news and commentary. It is important to run campaigns across all 3 to effectively cover the breadth of the active buyer pool and a part of the massive buyer market. None of the property portals have complete market coverage and each of these portals have a set of unique audiences.
segment of active buyers specific to the property as well as reaching the passive buyer pool. The campaign is structured to deliver quality leads for the property, and it auto optimises spend across social media and multiple digital channels, skewing the spend towards channels that are performing the best.
PRIMARILY PASSIVE & SOME ACTIVE BUYERS
Print continues to play an important role to cover the breadth of the market reaching quality and highly engaged audiences. It takes criteriabased search out of the equation with respect to the active market and is the most effective medium to reach the all important passive buyer
market. This is clearly evidenced by the fact that the New Zealand herald has seen a massive 48% increase in its print readership over the last 18 months and average time spent reading the paper is over 50 minutes. The value of print is also well supported by agent feedback.
Why choose us?
City Realty Group is the largest Ray White franchise in New Zealand with offices throughout Auckland. It is the group with the ‘family factor’ - we’re family owned and we treat people like family. We’re all about open doors and open minds. We encourage a unifying atmosphere where opportunities are created, individuals are recognized and everyone grows - from our team to vendors, investors and tenants.
Our experienced and established team service the market Auckland wide -from Residential, Luxury Apartments, waterfront properties and rentals. With a dedicated property management team and marine brokerage teams. City Realty Group has a strategic partnership with Loan Market to provide clients with the best mortgage advice and rates through brokers.
+64 (9) 281 4707
www.rwsandringham.co.nz
+64 (9) 308 5551
www.rwmtroskill.co.nz
Leaders in the Auckland Residential market.
Ray White Sandringham
Ray White Mount Roskill
Meet the team.
SALES TEAM - SANDRINGHAM OFFICE
Pauline Bridgman
Amy Tsai
Kate Jiang
Diane Goer
Emily Hu
Ivan Koulin
Hugh Free
Daniel Chen
Lauren Indrisie
Alastair Hubbard
Ash Anandani
Jay Nair
Tania Greer
Susan Woods -Markwick
Rosa Solano
Ren Agnew
Tracey Potter
Tim Cai
Yuhei Umezaki
Sammy Agnew
SALES TEAM - MOUNT ROSKILL OFFICE
OUR LOANMARKET MORTGAGE ADVISORS
WE CAN NEGOTIATE A LOWER RATE. WORK WITH A QUALIFIED AND COMPETENT MORTGAGE ADVISER
Mortgage Adviser
Damon Pooley Ethan Li
Jacky Mao
Jon Clark Lisa Hui
Mark Li
Nana Li
May Ma
Eva Yin
Benjamin Liu
Pantea Wilson
Sara Wang
Tony Liu
Grant Harvey
Shubhrta Khanna
Ross Harvey
Maggie Liu
Anna Dong
LoanMarket Mortgage Adviser
Jo Price
Davy Chen
Evie Gao
LoanMarket
Jamie Maclennan
