This Upturn Has Legs

A NZ Herald quote on February 8 said: “House no one wanted a year ago is snapped up for $1.2m in just seven days”.

Director of City Realty Group, Daniel Horrobin, says: “This quote is not directly related to our Auckland City apartment market, but is symptomatic of a wider confidence from both sellers and buyers generally. 

“Of the 15 auctions we have conducted in our Auckland Central office this year 12 have sold on the floor, a success rate of 80% under the hammer.

“We have more than 40 auctions (and counting) booked for the second half of February, a positive endorsement from sellers who sense the time for waiting is well and truly over.”

Government policy changes, such as promises to shorten the brightline test and to reinstate mortgage interest deductibility for investors, have no doubt contributed to a new-found confidence.

Also helping is commentary such as this, published on Stuff’s website on January 12:

Squirrel chief executive David Cunningham said: “Home loan borrowers should see rates come down as much as a full percentage point over the next couple of months. 

”Rates should already have dropped, given the sharp fall in wholesale rates before Christmas,” said David, the CEO of one of the country’s biggest mortgage broking firms.

Closer to home, a statement by the CEO of Ray White NZ, Daniel Coulson on February 1 2024 provides further encouragement. “The number of completed sales across the Ray White group in January was 18.9% higher than 12 months ago.” 

Rental demand continues to soar on the back of immigration.

Statistics NZ recently reported for the year ended November 2023: “There was an annual net migration gain of 127,400 (plus or minus 2500). That compared to an annual net gain of barely 11,000 in the November 2022 year.”

Daniel says: “We are delighted to begin 2024 on such a strong note and we look forward to the rest of the year with enthusiasm.” .