Despite sky-high interest rates, Auckland's housing market has bounced back with property sales being their best in a month since May last year.
During May, Barfoot and Thompson, Auckland's largest real estate agency, sold 723 properties, over 50 percent more than the previous month (473 sales). However, sales were slightly down from May 2022, which saw 782 properties sold.
This follows a slow month when sales hit their lowest in an April for 22 years and 11 consecutive official cash rate hikes causing mortgage rates to soar.
Barfoot and Thompson managing director Peter Thompson said May's sales were not far off pre-COVID levels, signalling Auckland's property market has either hit the bottom of the current cycle or is close to it.
Buyers have also returned to the high end of the market, with 31 homes being sold in May for more than $2 million, the second-highest number of monthly sales in this price category this year.
Thompson said the number of sales was the standout feature, as they were a third higher than the average monthly sales for the past three months.
"It shows buyers are not shying away from paying current mortgage interest rates," Thompson said.
However, sale prices did not follow the same trend.
The median sales price for May was $955,000, down 4 percent on that for April, while the average price at $1,070,819 was down 1.5 percent on that for last month.
"While the median price paid in May was down 15.1 percent on that 12 months ago, the average price was down much less at 10.9 percent," Thompson said.
"Vendors will be encouraged that prices have now reached that point where more sales are being made and support the recent comments by the Governor of the Reserve Bank that house prices are at 'more sustainable' levels."
The agency listed 1262 properties in May, which was close to the average during the last three months. That left 4390 properties on the agency's books at the end of May.
"While this is our lowest number in 14 months, it still ensures that potential buyers have a greater choice than was available pre-COVID days," Thompson said.
However, once sales numbers start to increase, Thompson said they can anticipate potential choices will start to decline.
These findings are in line with previous reports that the housing market may be starting to bottom out.
On Thursday, realestate.co.nz data found average house prices have remained flat for the past couple of months signalling New Zealand may have reached the so-called 'bottom' of this trend or, at the very least, a turning point.
Meanwhile, CoreLogic suggested a "near-term floor for house prices" after the national house price index fell 10.3 percent in April.
