Mortgagee sales begin to ease
The latest data of mortgagee sales for the month of February show that the pressure on homeowners struggling under mountains of debt may be easing.
A total of 121 mortgagee sales were registered in the month of February in data released by Terralink International. This total compares to 124 for the same month last year. This is the first time since November 2007 that the year on year change has shown a negative variance. For the past 27 months the picture has looked bleaker every month with some months showing year on year increases of up to 8 times. On a seasonally adjusted basis the month of February showed a 30% decline from January.
As the chart below shows the figures for February are traditionally lower than other months, and it is quite likely that the March sales may well be higher than February has been.
Seen over the course of the past 3 years it is very clear the impact that the economic recession had on distressed homeowners who were forced to accept mortgagee sales as a route to exit the debt burden.
These trends in mortgagee sales naturally track closely the number of listings that come onto the property market as mortgagee sales or mortgagee auctions. Realestate.co.nz provides a detailed tracking of these listings for the past 3 years on a weekly basis. The latest data is that there are currently 291 properties being marketed on the website as mortgagee sales. The chart below track the progressive build of listings over the period of 2008 and then the subsequent decline in number which began around a year ago.
In terms of regional breakdown of the sales of mortgagee properties, the majority of the sales are to be found in the larger regions of Auckland (37%), Waikato (11%), Canterbury and Wellington (7% each). The slightly higher representation of Northland at 9% of all sales in February and Otago (inc Queenstown) at 8% of sales would tend to indicate pressure in holiday homes potentially.
The regional breakdown on February sales is detailed below with the comparative latest 3 month average figures as well as year on year variance.