Going Digital: May Property Update
The lack of new COVID-19 cases from community transmission in New Zealand and the lessening of restrictions, means that we are ahead of the curve compared to other countries. With the country also advancing to Alert Level 2, moving back home may be a serious consideration for Kiwis living overseas. Knowledge of the current property market may help with educated decisions as to whether a move to New Zealand makes financial and professional sense. We caught up with Peter Thompson, Managing Director of Barfoot & Thompson to gain insight on the state of Auckland’s property industry and the role of technology in these times.
Auckland property market bruised but stable
The Auckland property market’s first month of trading under the COVID-19 lockdown left it bruised but with its underlying stability intact. Not surprisingly, it was the sales numbers for the month where the biggest decline was felt, and at 552 sales these were half those for March. However, those properties sold at prices not far below those in March, which were at their highest levels for more than two years, and for higher prices than they were 12 months previously.
The average price at $962,136, was down 3.2 percent on that for March, but still well in excess of the average prices for January and February, and 3.6 percent higher than the average price in April last year. The median price at $900,000 was down 2.7 percent, which is a modest reduction on prices for March, but again, well in excess of the median prices for January and February, and 8.4 percent higher than in April last year.
The trail of properties working their way through the sales system is now modest, and it will not be until trading results for May are available in early June, that a true indication of benchmark prices post-COVID are available.
Buyers and sellers should be realistic and meet the market
Sellers appear to be taking a cautious wait-and-see approach, a similar trend that occurred in past economic downturns. While each region would be impacted differently by COVID-19, main urban centres such as Christchurch, Wellington, and Auckland would be affected the least. Buyers and sellers should not panic, but they need to be realistic and meet the market. For sellers, this doesn’t mean they should automatically drop their price but they do need to listen to what buyers out there are saying.
Rural and lifestyle markets impacted but with steady buyer interest
The Alert Level 4 lockdown significantly affected the rural and lifestyle markets with sales numbers for the month only a quarter of what would be expected for this time of the year. Interest in far north dairy farms remained steady while lifestyle blocks, particularly those to the north of the Auckland urban area such as Waimauku, Woodhill and the Ararimu Valley, retained the interest of buyers.
Accelerated innovation gets the real estate business moving
As the country sat through lockdown with restricted face-to-face activities, we adapted our 97-year-old business with a suite of online tools to get business moving in a safe manner. Online auction is our most recent service offering which will be of great benefit to Kiwis living overseas wanting to house hunt. While others have had live-streamed auctions combined with phone bidding, we are the first real estate agency in New Zealand to allow people to place bids online.
We’ve also introduced online contract signing, virtual appraisals, virtual viewing using video conferencing tools or 3D virtual tours, virtual renovations, and the virtual Furnish product that allows buyers to test their furniture in the new house.