Prices falling in Auckland by how much?

Regarding prices falling, I understand a Meadowbank house that a colleague and I auctioned yesterday in Meadowbank was on TV3 News last night. Apparently the commentary said that the house would have sold around $900,000 at the peak of the market (last year) and couldn’t get $700,000 yesterday. Bidding stopped at $681,000 and current negotiations are into the $700,000s. Last year the owners paid $775,000 so I don’t know where they got $900,000 from. Don’t let the truth get in the way of sensationalism though eh! And by the way $775,000 minus 9% would be $705,250. This vendor will do better than the average punter when this deal is closed soon.  View the factually incorrect video here

Sales volume slump looks worse than it should

Today’s headline news:  Sales fall 56.2%…

Barfoot and Thompson said sales volumes fell to 632 in March 2008 from 1,444 in March 2007.

While this is a big drop in sales numbers, a more balanced perspective would be gained by calculating the average number of sales per month for the past 12 months, versus the 632 figure.  The drop (on average) would then be more like 10% – 15% I think.

My Remuera branch set a B&T all time sales record in March 2007, selling over $90,000,000 worth of property.  The number of sales (I don’t have the exact numbers in front of me) were extraordinarily high for that month.  From memory, throughout the industry, sales numbers for March 2007 were also very high.

This unusually bullish result amplifies this apparent “crash”.  I don’t think the evidence, when viewed from this perspective, indicates a crash.  But with so much negativity out there the sensationalists might make a crash become a self fulfilling prophecy.  Hold on tight!