All just a bunch of rose-tinted glasses?
Thursday, May 8th 2008, 11:10AM
The Auckland house sale figures from Barfoot & Thompson are fascinating. While the company tried to paint a positive picture of what was happening in New Zealand’s biggest real estate market, others interpreted it far more negatively.
Sure – the numbers weren’t flash with sales down and rents flat. But there may be some good news in the picture as B&T managing director Peter Thompson says.
He says that a growing proportion of sales are taking place in the less than $500,000 bracket, and that the average price in this market has held up.
”This suggests two things. That new buyers entered the market encouraged by the wide range of stock available and that price discounting is nowhere near as prevalent as media reports would have us believe.”
My previous Blog suggested that maybe there is some good news out there – one of those factors being that interest rates may fall sooner than expected.
The B&T sales numbers help support that view, as I note Goldman Sachs JB Were read them and was moved to comment:
“With accumulating evidence of broad-based slowdown in the economy and credit rationing by banks, the need to pursue very tight monetary policy has reversed. We continue to expect interest rate cuts to begin between June and September.”
The other positive bit of news was the ANZ/NZ Property Investors Federation survey of investors.
Overall the respondents were positive. Some may say over-optimistic. (Take off your rose-tinted glass, I hear you say!)
I think it is imperative to look at who the respondents are. To me they look like investors who are experienced and have a good level of knowledge of what is happening in the property market.
These people don’t see a market slow down as a negative. In fact, they see opportunities to buy. These are opportunities they haven’t had for some time as prices have been way ahead of themselves.
| « Now for some good news | It's raining rate relief! » |
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