Ed McKnight: Property investment expert reveals whether or not the housing market is set to take off

Property sales have reached the highest point in years - but the number of unsold homes is at a record high.

Barfoot & Thompson has revealed March was a record month for house sales, but unsold stock numbers have been climbing, with 5300 places unsold in January and 5900 in February but 6200 last month.

Property investment expert Ed McKnight says vendors aren't willing to take risks at this point.

"It's a bit of a game of who's going to blink first - are those sellers going to capitulate to what the market is actually willing to offer?"

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Episode Transcript

Speaker 1 (00:00):
Property sales are the highest in years, but the number
of unsold houses is also at a record high. Auckland
real Estate company Barfoot and Thompson said March was a
record month for house sales, the most since twenty twenty one.
But while listings and sales are up, Tony Alexander says,
the price they're selling for hasn't gotten any better. So
where does this leave us. Let's get a picture a

(00:20):
snapshot of the market. Resident economist at Opah's Partners Ed
McKnight's with me now ed.

Speaker 2 (00:25):
Good evening, Great to talk to you, Ryan.

Speaker 1 (00:28):
So what's behind, first of all, the behind the rising
number of unsold properties.

Speaker 2 (00:35):
Yeah, we're seeing a lot of listings on the market.
Depending on what you look at than terms of the
data source, somewhere between thirty two thousand up to forty
thousand properties that are currently sitting there on the market.
There's a couple of things happening there. There are actually
more properties that are selling, but we're equally seeing a
lot of supply coming onto the market as well. And
then on top of that, those listings that are coming

(00:57):
to the market are also sitting around for a lot longer,
so we're seeing the days to sell a property. It's
up from about fifty five days, up from fifty one
days last year up to fifty four this year. So
it's not just about more listings, it's also that those
listings are sticking around, and.

Speaker 1 (01:14):
Then that what the owners the vendors basically don't want
to drop the price, don't. They not willing to go
below a certain amount, so they're happy to sit there.

Speaker 2 (01:21):
It's a bit of a game of who's going to
blink first? Are those sellers going to capitulate to what
the market is actually willing to offer. And it's quite
fascinating because I see this myself with friends who are
selling properties that they're saying, oh, my real estate agen says,
I could flick this property off, but i'd really have
to lower the price. Well, if that's market price, that's

(01:42):
the market price. You either decide to sell it or
you sit there on the market. Some sellers are saying,
you know what, maybe we'll just sit there on the market,
not take that listing off. Yeah.

Speaker 1 (01:52):
I've heard a bit of that too, A lot of
talk that maybe where you know, at the bottom of
the curve was starting to come out of it, and
there's there's some low cost suburbs that are starting to
pick up, you know, two three, four percent in price.
Is that what is that happening or is that defigment
of people's imaginations.

Speaker 2 (02:09):
Oh, that is happening. If we look at Inbicagol City,
where we've got some of the cheapest properties in the country.
I mean you can buy two or three houses down
there for the price of a single Auckland property. House
prices an Inbicagol up four percent year on year. Southland,
which is you know, just kind of surrounds in the
Caagol they are up six percent per year, and a
lot of the west coast of the South Island, where
again we've got properties that you can still buy for

(02:31):
three hundred thousand dollars, are seeing a bit of growth.
Of course, when those properties are a bit cheaper, a
four percent or a three percent might be ten grand
worth of growth, So it's not necessarily massive numbers, but
as a percentage, you're seeing a bit of an uptick.
Wherever house prices are a little bit more expensive, like
in christ Church, they are only kind of up one
percent year on year. Auckland's still losing a little bit

(02:53):
of ground house price is there down two percent year
on year, but it's kind of middling growth. Ryan. You know,
there's nothing spectacular happening at the moment, but it does
seem to be a bit of a recovery. Here's one
stat you might like. Over the last six months, we've
seen house prices go up seasonally adjusted house prices go
up five out of those six months. The six months

(03:16):
before that, house prices went down five out of those
six months. So we said what we say is a
bit of a tune there. But it's not like we're
going to go through a boom and we're going to
be up another ten percent over the next twelve months.

Speaker 1 (03:29):
We're not taking off in rockets quite yet. I do
love a good house stat, Ed, Thank you very much.
Ed McKnight, Resident Economists That Open's partners.

Speaker 2 (03:37):
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