First National – which has about 70 offices nationwide – has released a survey of its members which it says shows auctioning a house is the least effective way of selling.

But Barfoot & Thompson has hit back, saying auctions are a preferred method and have little to do with a successful sale.

Meeting the market with a realistic price is far more important than the mode of sale, says Barfoot director Peter Thompson.

“Auction makes people make decisions quicker, and it gives more of a timeline for vendors to know how long their properties will be on the market.”

The First National survey asked property agents within the group to rate the effectiveness of selling methods in their regions, and not just their own businesses.

About 72 per cent said individual negotiation between buyer and seller was the most effective, followed by tenders at 18 per cent.

John Stewart, group general manager, said this was because of the current subdued market.

At a time when buyers were scarce, auctions might not be the best way because buyers must be able to buy unconditionally.

Mr Stewart said another agency that took 10 properties straight to auction last month found there was not a single bidder.

First National, which has about 500 sales agents, does a monthly survey to measure key market indicators. It found that while listings were up last month, overall buyer inquiry was lower than February.

“In times like this, where buyers are few and far between, the best price may well come from someone with a home yet to sell rather than from one of the few cashed-up buyers in the market,” he said.

Auctions were considered the best method in just five locations – Manurewa, Rotorua, Waiheke, Tauranga and Timaru. However, they were also working well for mortgagee sales, said Mr Stewart.

“Mortgagee sale appears to be ideal for auctions and tenders can provide vendors a multi-offer situation, but mainly we are seeing properties get the best price through skilful individual negotiation.”

Mr Thompson disagrees with the findings of the survey.

The real estate group conducts the most property auctions in the Auckland and Northland regions, where auctions continue to be the preferred mode of selling real estate, he says.

“We’re averaging 80 to 100 auctions every week, and about 35 to 40 per cent are being sold under the hammer.”

Properties which were not sold on the day of the auction were selling in the weeks after, he said, and that brought the numbers of properties sold by the group to between 70 to 75 per cent.

“There are plenty of buyers out there … there have been many instances in recent weeks where we have been selling properties between $30,000 and $40,000 above the reserve that was set.”

The way to sell was to have a realistic price that met the market.

By Lincoln Tan | Email Lincoln

The block at 17 Blake St near Jervois Rd has cladding defects, which resulted in mould and fungal growths including the dangerous stachybotrys.

Water has damaged a lift shaft and carpets and rotted timber balustrades, now replaced with steel. All cladding needs to be stripped off and rotten timber replaced. About $250,000 has been spent on temporary measures.

The owners have filed an $11.7 million claim in the High Court at Auckland against the Auckland City Council, Clark Brown Architects and Carson Group.

Peri Hoskins, Blake Central’s barrister from newly-formed specialist leaky-building practice Hoskins Thorn, said $1,633,500 of the claim was for stigma. This was an unusual move but an attempt to recognise sale difficulties even after the work is finished, he said.

“Buyers will either not buy a once-leaky home or they expect to pay less for such a home despite the fact that the repair work has been carried out and the home apparently no longer leaks,” he said.

In a speech to Parliament yesterday, Mr Key indicated the Government would change the way property was taxed. A land tax and comprehensive capital gains tax were ruled out, but a tax realignment and changes to depreciation write-offs for properties are expected.

Massey University property group professor Bob Hargreaves, who compiles a quarterly Home Affordability Report, said tax reforms would put a brake on rising house prices – but they would not become affordable for average families and young Kiwis for some time.

“Unfortunately no. Home affordability is not going to be great as we go into 2010,” Mr Hargreaves said.

The recession had slashed house prices last year, but most of this had already been reversed.

Meanwhile, interest rate hikes expected later this year would make home ownership dearer, Mr Hargreaves said.

Andrew King said Key had erred on the side of caution and been politically astute.

“It’s what we expected but it’s nice to hear it,” King said in reaction to Key’s speech to the House shunning most of the Tax Working Group’s advice to hammer landlords.

Key ruled out a 0.5 per cent land tax which would net $2.3 billion annually and a capital gains tax and said there would be no introduction of a recommended scheme to tax rental income at the equivalent of a risk-free rate of return, pulling $500 million-$900 million a year.

King said most landlords hoped Key would not implement the Tax Working Group’s recommendations which floated these ideas.

As for the May Budget, King said he was not too concerned and predicted only one change to the system.

“I think he’s going along the lines of disallowing building depreciation.

I can’t see him banning Loss Attributing Qualifying Companies because the biggest users of those are forestry businesses. All banning those would do would mean residential investors would own properties in their own names and they would still get the same tax deductions,” King said.

Axing building depreciation would bring in about $1.3 billion annually, the working group predicted.

King remains disappointed and angry about the group’s report, saying it undermined the $200 billion residential property sector, created widespread misconceptions and skewed information which stirred up anti-landlord sentiment.

He cited a sub-report to the group from Inland Revenue and Treasury which said that in the last 28 years, landlords had paid tax every year except 2007 and 2008 when interest rates were so high that they claimed deductions on mortgage costs.

“The working group’s report is misguided. It is not as thorough as it should be,” King said.

But John Shewan – group member, landlord and Pricewaterhousecoopers chairman – said some multimillionaire landlords qualified as state beneficiaries because they appeared poor on paper.

He said the $200 billion tied up in residential rental property was four times the capitalisation of the NZX yet resulted in negative tax.

Lee Whiley, an Auckland landlord, is worried about disallowing depreciation and predicted this could halve his annual income from six properties.

Key released little about the Government’s tax plans but said landlords would be made to pay their share.

“The Government does believe there is a gap in the current tax system around property investments where income is being derived but, in aggregate, no tax is being paid – in fact the Government is actually losing revenue in this sector,” Key said.

“We will therefore be making changes [in the Budget] to the way property is taxed which will result in … more fairness for taxpayers.”

Note: $25 extra per person per night above 8 people.

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Fantastic beach house which sleeps up to 10 (Conditions apply) . Large open plan living area and expansive decks. Hop, skip and jump to lovely Matarangi beach, tennis courts and playgrounds. Dishwasher, New washing machine, dryer and all mod cons. Kids toys available etc. The local shops and café are 5 minutes’ walk away and the golf course is just a little further.

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Matarangi is a perfect location for peaceful strolls along the beach, pleasant outdoor evenings,safe swimming and boogie boarding, exploring the rocks, fishing, and simply relaxing. Located halfway between Coromandel township (with craft shops and historic attractions) and Whitianga township (with marina, cafes, shops including a large supermarket), Matarangi is a great location from which to explore the stunning Coromandel peninsula. The Property comes prestocked with lots of things to keep you busy, including:

Secure warehouse in busy location.

Unit F is a 146 M sq unit comprising of 123.5msq ground floor and a 14 msq Mezzanine floor. The unit is near new. The carpark has security fencing which is electrified, and gates which open and close on a timer system, automatic lights which are activated after hours. Three phase power is available in the unit along with easy access for IT cable.

Property Profile

Industrial/Commercial storage, light manufacturing
No pets
Bathrooms: 1
Parking: 3
Floor Area: 146

Watch this video for a brief insight into the powerful potential of Auckland’s Manukau City.

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Awesome Clifftop section overlooking the 17th Green and Water views to 120 degrees. RV in 2008 at $850,000 Consider swap trade for any income producing property Barter Card Bartercard considered.

Gulf Harbour Country Club Video

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