Harcourts’ South Island Regional Manager, Jim Davis, comments on the Christchurch real estate market.
As we move into the festive season and the inevitable slow down of Real Estate activity that occurs in late December and over the early January period, it is interesting to read that the market commentators are now caught up with the reality of our Market this year. The Blazing headlines in the Press property section this week.
“No Aussie-style property slump” this is exactly what we at the coal face have been saying for over a year now. Christchurch, this strong steady resilient city of ours, has a real estate market that reflects exactly this. When I run the figures for just the Harcourts offices in our city for the last year and compare it to a year ago the statistics are remarkably similar. There are a few less consultants running around the city but those that are, have all performed a little bit better over the year.
You might recall that in October Canterbury recorded the best sale month for the last 10 years according the REINZ sales statistics. Today REINZ has just released the data that relates to the month of November, and the result is another strong month.
In November there were 620 recorded Residential sales here in Christchurch, the reported Median is $460,000 with an average time on the market of 32 days. These figures are just slightly back on last month but that is not unexpected when you are following a strong Spring period. There is no doubt that there is plenty of activity happening in our local market, strong sales are being recorded right up to the Christmas break and open homes are still well attended. However, it is a very balanced situation currently. Buyers have plenty of choice available to them, and from what I am hearing that choice will continue well into next year when the post -Christmas rush starts. This is based on the number of people already talking to our consultants about their plans post- Christmas. With choice for buyers comes caution and options, hence the reason that property seen as overpriced by the market will be rejected and inevitably will sit until the price expectation of the owner is reviewed.
Auctions continue to be our preferred marketing option, and in a balanced market such as we have now it is not unexpected that clearance rates “on the day” drop off a little bit. We still seem to be having around 50% sold under the hammer and the another 20-30% sold subsequently usually to people introduced during the auction program. This is the great part about Auctions , as a vendor you effectively get two chances. The first opportunity is with the cash buyers, the second chance is with the rest of the buyers who are waiting and hoping a property doesn’t sell under the hammer. This method has an advantage for both sellers and buyers, in that the process attracts the ‘cash buyers’ first off and for sellers this means certainty of sale if the price is right. For buyers it means the pool of potential competition is lower initially and they don’t have to worry about getting caught up in the “smoke and mirrors” of a multi-offer scenario. So, can auction work for all parties and that’s why it is favoured by most people.
There is no doubt we will see the traditional Christmas slow down start to take effect in about a weeks’ time, but I have little doubt that there will be a burst of pent up activity on the scene as soon as everyone settles back in the New Year, and I think that is what the media market commentators are now realising. Our market place is a replica of Christchurch itself; strong, steady and resilient.