Auckland real estate agent slashes commissions amid frozen market

By Leith van Onselen

The most recent REINZ housing statistics revealed a sharp decline in Auckland transaction volumes, which were down circa 30% in the year to July:

And are tracking at their lowest level in five years in 12-month moving average terms:

Today, Interest.co.nz reports that a real estate agent has slashed their commissions by half in a bid to drum-up business:

Nigel Tyre is a licensed agent with LJ Hooker’s Royal Oak branch and specialises in selling properties in Epsom, Royal Oak, One Tree Hill, Onehunga, Hillsborough and surrounding suburbs.

He has written to his contacts offering to sell their properties at 50% of the normal commission rate if they “are selling soon.”

The offer comes following a sharp downturn in property sales in Auckland…

Tyre said the promotion was a limited offer that would not last indefinitely…

It’s amazing that a real estate agent in a city where the average dwelling price is more than $NZ1 million, and which is experiencing rampant immigration-fueled population growth of around 44,000 people a year, is struggling to make a healthy profit.

Just goes to show that real estate agents are concerned with transaction volumes first and foremost, rather than rising prices.

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Comments

  1. is the NZ housing bubble being driven by all the same shit we have in aus? do they have boatloads of perverse incentives + foreign buyers + negative gearing too? or is it all immigration?

  2. In a rising market when everyone believes that the party will continue for ever, nobody wants to sell for fear of losing out on further price rises.
    Kind of like the share market. Volume start to dry up at the top. Then collapse when there are no willing buyers.

  3. What always amazes me is that these spivs have been able to keep their fees so high for so long….
    Take a look at some of the real estate offices and how much is spent on fit out and meeting rooms…the definition of hubris.

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