There are a lot of positive signs in the Auckland City apartment market, with Ray White City Apartments’ sales having slightly exceeded our listings for the month of April. This means if anyone is looking to bring their property to market, now would be a good time to do so, before any further interest rate rises impact buyers’ borrowing ability. April has traditionally been a month in the real estate calendar recognised to have challenges, with its three days of statutory holiday prompting so many people to go away. Yet there have been packed houses for Ray White City Apartments’ auctions for the last two weeks. It has been pleasing to note the competitive nature of buyers going up against each other in our full auction rooms of late. We do also continue to offer the option to attend auctions online.
City Apartments’ 53% auction success rates under-the-hammer in April is significantly higher than that of the rest of the Auckland market for the month. Our auctions have averaged 14.8 bids and 2.2 bidders per auction. A number of properties which passed in during March auctions have subsequently sold in April, bringing our year-to-date auction success rate to 61.5%. Apartment buyer activity has picked up with the country’s move this month from red to orange under the Covid traffic light system. When Covid wariness was particularly high, people seemed especially reluctant to inspect apartments because of apartment buildings being more populated than stand-alone homes. Therefore, the relaxing of regulations and attitudes under orange is significantly affecting apartment buyer activity.
We hear a lot of Auckland businesses are now encouraging their staff to come back into the office to work and we expect a positive flow-on effect on apartment rental rates as a result. We saw a slight drop in the average number of days rental listings were on the market in April, from 26 to 25 days. While not a significant reduction, we hope this is the start of movement in the market. There has been good April demand from 30-39-year-olds wanting to rent 1-2-bedroom apartments for between 500 – $600 per week. There continues to be the sort of demand as was evident in March for new high-end apartments commanding between $800 – $1200 per week. However there is a short supply of stock to cover this demand.
With New Zealand’s borders now open to the vast majority of the world, we anticipate another positive milestone in June. That is when the Government-announced clarifications to the Credit Contracts and Consumer Finance Act 2003 (CCCFA) are to take effect, predicted to ease the process for those seeking mortgages.