Barfoot and Thompson sold only 86 of the 226 properties they tried to auction last weekend. Last year, March was the busiest month for the company, when 1341 properties were sold.

Auckland listings on Trade Me have increased to 10600, up from 9000 a month ago. The number of properties with “reduced” in the title has risen from 70 in Jan to 101 today. Since early February other keywords have also increased. “Motivated” from 352 to 418. “Urgent” from 95 to 135.

Two year interest rates have risen from 4.3% to 4.8% and are expected to rise further.

Meanwhile, China has cracked down on money laundering and implemented controls on money exiting the country. Stories abound of Chinese purchasers walking away from commitments to purchase in most Western hot property markets. London, United States and Australia are all reporting massive drops in sales. Many claim the market is only being kept afloat by black money shifted overseas from China before the controls were put in place.

This is not just a matter of a falling real estate market. The NZ economy is tied to Chinese capital inflow, immigration and the real estate boom. National have taken credit for what many perceive as a “thriving” economy. They have promoted themselves as “good economic managers”.

With an election due in September this year, the National Party and Bill English in particular would not want to see this perception founder.

An interesting aside. John Key is a banker, and probably understood the ramifications of China’s new regulations long before many. Was this one of the reasons for his sudden resignation? Did he foresee a potential calamity for his government?