That’s what this report in the business section of NZ Herald reported yesterday Wednesday April 1st. Was this an April Fools joke? No, it seems not.
According to the report by an un-named writer, Nelson home sellers were listing their properties on the market to sell at a median asking price that was 12.7% up on same time last year. Only Gisborne & Northland were higher at 21.5% and 13.2% respectively.
Is there any justification?
The opening paragraph of the Herald report said that….
“after months of being told to lower expectations, people trying to sell their homes are pushing asking prices up even higher – now asking for money not seen since the peak of the property boom in 2007.”
Looking into the two main geographical charts contained in the report its interesting to note that my ole friend Mr “Supply & Demand” is cropping up again. The top chart shows that out of the whole country, our Nelson region, was about the only one that was “business as usual”, just 3% off normal, as far as new listings coming onto the market in March 09 was concerned.
This sort of info is borne out in our present low number of mortgagee sales, numbering 1 when I ran this report this afternoon, there is no local rush to sell as the general NZ media would have a buyer believe.
In fact, regionally wise, we have come down from over 900 for sale listings on Feb 2 to 850 at the beginning of March to 760 on April 2. Keeping in mind, new listings would have been coming on over that period too, at what is usually the busiest time of the year locally, so you can start to imagine why all the fliers in local letterboxes are telling a similar story “buyers here, want more listings.”
You also need look no further for additional evidence than our rental market, as local rental rates are riding a 4 year high, and local Property Management companies are stating they have pages of potential renters on their books looking for a place to rent, but there just aren’t enough local properties available to let out.
Not to put too fine a point on it, the author of the report, Alistair Helm said that the low volume of new listings coming on to the market may have forced some agents to……
“secure new property listings by agreeing to list at what may turn out to be unrealistically high asking prices set by the vendor.”
Considering that Mr Helm is privy to much database information from NZ’s biggest dedicated real estate portal that is realestate.co.nz, especially in regards to a property listings total lifespan on his site, and the number of different agencies it may go through until successful sale is achieved, this statement intimates or at the very least hints that there is some extra information buried in the numbers that gives breath to the suggestion that we aren’t quite seeing the full picture yet. And if you haven’t heard of the term “buying the listing”, then Google it.
So to answer the question……….without the sort of numbers that would show how long a property has been on the market in TOTAL, sometimes through 2 or 3 different Real estate companies, and whether there were corresponding price adjustments overall or at change of agency times, then I really can not say anything other than we just have to let Mr Supply & Demand prevail.
One thing that does stand out is that those areas quoted in the report as asking for the higher property prices, namely Northland, Nelson, and Central Otago/Lakes are some of the usual suspects where market reaction is often seen first when a barometer is required for current market status/ market trends, particularly so from a provincial perspective.
CHART SOURCE – NZ Property Report –March 2009 (www.realestate.co.nz)