Auckland's average weekly rent fell by $14 in February from the all-time high of $416 in January, according to the latest Barfoot & Thompson housing market report.
"The fall in weekly rent was anticipated as the normal influx of people into Auckland over January eased," said Barfoot & Thompson managing director Peter Thompson.
"Even so, February's average price is $12 above the average rent for this time last year, and the market has certainly settled at a new benchmark."
ASB economist Chris Tennent-Brown said the rental figures were consistent with a tight market, "judging by the high level of weekly rents achieved over the past six months."
"Barfoot & Thompson continue to have a high inventory of properties to rent, and weekly average rent is up 3% on last year's level, despite a 1% dip in February," he said.
Over February Barfoot & Thompson rented 817 properties, on a par with January and 112 more than February last year.
Despite the fall in rents, the resilience of the Auckland housing market was shown in both sales and average price figures.
Sales volume increased on January's number by 9.9% to 619, and the average price increased 1.2% to $521,887.
"Another positive factor is that during the last three weeks of February the number of sales agreements reached were higher than for the same three week period last year. You have to go back 12 months to find when this last occurred," Thompson said.
"It adds up to a housing market that, while turning over relatively modestly, is holding up price wise."
Thompson cited the return of new sellers for the revived market interest seen in February.
"New listings at 1529 were close to what we would expect at this time of the year in a moderately active market. They were also up 70.6% on those for January, but that month's new listings were exceptionally low and this comparative figure is somewhat misleading."
Tennent-Brown said the housing data for February showed encouraging signs coming in the wake of several months of weak activity.
"In particular, the 9.7% lift in seasonally-adjusted turnover is stronger than recent mortgage approval data has suggested."
He also cited Auckland's low construction over recent years and population growth as factors supporting the property market.
"Over the next few quarters, we expect nationwide prices to remain down around 5-6% from the 2007 peak, and only recover gradually in the years ahead. The dynamics of the Auckland market will likely lead to price lifts that are stronger than the nationwide experience."
At the end of February, Barfoot & Thompson has 6053 homes on its books, 3.4% more than in January but down 3.1% on February 2010.
"The key to the market continuing to turn over modestly is new listings. There is not a glut of homes on the market, there are buyers out there and there is competitive mortgage money available," he said.
"What remains tight is choice."
Source: Landlords.co.nzcomments powered by Disqus