Ray White Now New Zealand 19.10.2020 Version 22 - 19 October 2020 - Page 12

Buyers behaviour remains constant with their journey starting out by looking at property online . Evidence shows through our Ray White website that buyer online enquiries have surged on this time last year . To expand on this , industry real estate portals such as oneroof . co . nz , realestate . co . nz and trademe . co . nz / property are also reporting compelling evidence related to online enquiries .
The next organic move in a buyer ’ s journey is to view the property , proceeding to offer or bidding at auction . We can evidently report on this through our transparent auction data . When we look at our auctions held over the past week , we attracted on average 4.3 registered bidders across auction properties .
When we observe different aspects of the market , one point that remains positive is our active days on market . This is the average number of days a property takes to sell in current market conditions . In September , the median number of days to sell a property nationally decreased 4 days from 36 to 32 when compared to last year and the lowest days to sell since March at 30 days . This is evidenced by the strength of the market , favourable lending rates coupled with supply and demand which is placing downward pressure on the average days it takes to sell a property and upward pressure on prices .
So what factors are contributing to buyer confidence ?
Interest rates continue to underpin purchasers buying power and today interest rates are at record low levels , advertised from 1.99 per cent fixed for one year with the OCR remaining at 0.25 per cent since 16 March 2020 .
• Importantly , the consensus among economists is that they will remain at these low levels for the foreseeable future .
• Interest rates are a driver of home affordability and in many areas , while prices have risen in the last 12 months , corresponding interest rates have reduced .
• Banks and lenders remain very supportive of lending for residential property . The chart on page 13 shows the monthly home loan pre-approvals recorded by the Loan Market Group , which is our loan brokerage partner and New Zealand ’ s largest independent broker that settles over NZ $ 650 million in loans per month . Pre-approvals are indicative loan approvals obtained by buyers before they buy a property to enable them to bid confidently .
• Record levels of government stimulus are part of the supporting reason behind a high proportion of buyer sentiment .
Buyers having the maximum financial capacity to purchase a property is one of the key leading indicators when it comes to buyer confidence . Loan Market , our loan brokerage partner , has reported over $ 1.2 billion in pre-approved loans across New Zealand . These are buyers that are ready to proceed with offers where no finance clause is required .
“ Sellers in the market right now are benefiting from more active and motivated buyers , unconditional offers and competition for property at auction . This is not only providing them with absolute clarity around value , in many cases it is resulting in significant premiums in terms of the prices being achieved .” Gower Buchanan , Director Ray White Ponsonby , Grey Lynn , Mount Albert and Birkenhead .