While Auckland house prices remain in check, sales are increasing

Some are suggesting that the high number of homes for sale in Auckland is a sure sign that market turnover is ‘under pressure’ or ‘sluggish’ and has ‘yet to recover’ momentum.

While I agree to the interpretation that the level of homes for sale is contributing to keeping a check on prices, in terms of the number of sales being made, the market is in fact doing very nicely.

For most of this year, Barfoot & Thompson’s stock of homes for sale at the end of each month has been around 6,000*, the highest it has been since 2008, and significantly higher than during the 13-year period 2010 to 2023, when the monthly number ranged between 3,000 and 4,000 homes.

But countering this is the number of homes we are selling.

This year we are selling on average 900 homes a month, our highest number for three years. Based on the monthly average, this year our sales are 7% higher than they were in 2024 and 26% higher than in 2023.

So, what is causing this imbalance between high sales and high number of properties for sale at month end? For me, the answer lies in the surge in new builds progressively reaching the market.

For many years we were told the Auckland market was some 20,000 to 30,000 homes short of meeting its population’s needs, and this was artificially inflating the price at which homes sold.

Regulators and developers have been constantly working on ways and means of rectifying this shortage and at last, the gap appears to have narrowed. Auckland is now reaching the point where the supply is such that the number of homes for sale at the end of each month has nearly doubled.

Good news for those in the market for a home, but not so good for those looking to sell.

While 6,000 homes for sale at the end of any given month may sound a lot when compared to the last 20 years, delving into our records it shows the norm during the 1990s was between 5,000 and 7,000. If this number returns to being the norm it will be welcomed by buyers.

While sales numbers are on the increase, based on sales price data for Auckland over the past six months, prices are showing little movement. It is a conclusion I view with a degree of caution.

Of the new builds coming on to the Auckland market a large number are competitively priced at under $1million, and these sales may well be having a dampening effect on the ‘average’ and ‘median’ prices being reported.

For example, in 2022, 40% of all the homes we sold were for under $1 million. In 2024, this increased to 52%, and in 2025, year-to-date the level is 54%.

Falling prices alone would not produce this level of percentage change in the under $1 million market. There are simply more lower prices houses for sale now than there has been for many years, and these are appealing to first time buyers as well as existing homeowners looking to downsize, modernise or relocate.

What is apparent is Auckland is going through one of those periods of generational change in how people want to live their lives.

Probably, the highest profile example of this is the dramatic change from ‘in office work’ to a combination of ‘home and office work’.

A similar type of change is occurring around how people want to live. The retired generation is finding village living attractive, many younger couples are preferring the flexibility of renting rather than locking themselves into lifelong mortgages, while others are questioning the level of personal wealth tied up in a home, and are looking for smaller, less costly alternatives. All are contributing to the growing trend towards apartment and townhouse living.

Auckland still retains its pull as a place to work, live and play - it’s just its people are readjusting their housing preferences.  

In a market going through such a state of change, astute vendors are those who price their property ‘at the current market value’ when listing. They are the vendors selling, while those who inflate their asking price in the hope that in time the market will eventually rise to meet them run the risk of missing out as more properties enter the market at the higher selling point.

 *All numbers are based on Barfoot & Thompson sales data.

Peter Thompson

Managing Director, Barfoot & Thompson

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