PHOTO: For Sale. FILE
Rising Rates of Property Delisting in Auckland and Northland
In Auckland and Northland, more than 35% of homes listed for sale are being withdrawn from the market, a trend that one economist describes as concerning.
Ed McKnight, an economist at Opes Partners, has analyzed listings and sales data to estimate the rates of “delisting” in various regions. His findings suggest that Northland is facing particular challenges. In the six months leading to March, 2128 properties were listed for sale in Northland, but about 969 were withdrawn before being sold. This equates to a delisting rate of over 45%.
Delisting Trends in Auckland and Northland
In Auckland, the delisting rate is slightly over 35%. McKnight’s analysis contrasts these figures with Wellington, where the property market appears much stronger. In Wellington, 3633 properties were listed for sale in the same period, with only 375 being delisted, a rate of around 10%.
McKnight notes that regions with higher selling rates, such as Wellington, Otago, and Canterbury, are generally larger markets.
“The trouble with Northland is that it is a very large area geographically. So rather than one large market it is a collection of many small property markets with small buyer pools. That can contribute to large swings where the market is either very quiet or very busy,” he said.
In Auckland, current market weakness is partially attributed to high interest rates. “Because mortgages tend to be larger in Auckland—since house prices are more expensive—that can contribute to buyers being more cautious,” McKnight explained.
Insights from Real Estate Data
Vanessa Taylor, general manager at Realestate.co.nz, acknowledges the difficulty in tracking the exact number of properties withdrawn without a sale. However, her data indicates that properties withdrawn from the market this year were listed for an average of 99.97 days, slightly less than the 105.88 days recorded last year. Increases in the listing period were noted for lifestyle properties, sections, and studios.
“We are seeing quite a significant increase in stock,” Taylor said. “We’re back to ‘normal’ levels of listings but what the difference is, is how long it’s taking for properties to sell at the moment.”
Taylor added that agents are finding it challenging to align vendor expectations with current market realities. Often, properties are initially listed at prices higher than what the market is willing to pay, leading to price reductions after a period of time.
Real Estate Agents’ Perspective
Paul Sumich, a real estate salesperson in Whangārei, recently withdrew a listing from the market due to seasonal factors, noting that coastal properties may not appeal as much during winter.
“You do tend to see this during the winter months, especially waterfront properties, they really are standouts in spring and summer but if people have been on the market over summer and haven’t got a result, they tend to rest over the winter months and come back at spring time,” Sumich said.
He also observed that some sellers might hold on to outdated price comparisons from when interest rates were lower, affecting their expectations.
Andrew Duncan, a property commentator, explained that real estate agreements typically last 90 days, and if a property does not sell within that timeframe, owners might withdraw it and take a break before re-listing. Financial pressures can also lead to decisions to rent out properties rather than keep them on the market.
Brooke Gibson, another real estate agent, highlighted that unrealistic price expectations from vendors often lead to properties being withdrawn. “Lots of homeowners think their home is worth a lot more than it is so they take it off the market,” she said.
Market Outlook and Recommendations
With properties being listed for longer periods and increased stock levels, vendors and agents are navigating a challenging market. Real estate professionals suggest that sellers consult with agents to set realistic expectations before listing their properties to achieve better outcomes.
Trade Me data also shows an increase in the median days properties remain listed on the site, rising to 68 days in May, an increase of six days from April.
The trend of rising delisting rates in Auckland and Northland reflects broader market challenges, including high interest rates and varied buyer activity across regions.
SOURCE: 1NEWS