Home Seller Offers a Free Tesla!

The listing for a new 7-bedroom house in the suburbs of Auckland, the nation’s largest city, is offering one of Tesla Model Y cars.

The supply of homes for sale rose 43% year-on-year last month, according to the Trade Me property auction site, further driving down prices. (AP)

A homeowner in New Zealand's rapidly cooling housing market is turning to an unusual way to attract buyers -- by offering a free Tesla car.

The listing for a new 7-bedroom house in the suburbs of Auckland, the nation's largest city, is offering one of Tesla Inc.'s Model Y cars, an indication of the lengths sellers are going to advertise homes as jumping borrowing costs hurt demand.

The advertisement, by real estate agents Barfoot & Thompson is headlined: “Brand new Tesla and brand new home.”

Aggressive interest rate hikes by central banks worldwide have caused a global slump in housing markets, with New Zealand being one of the hardest hit. The supply of homes for sale rose 43% year-on-year last month, according to the Trade Me property auction site, further driving down prices.

Residential property prices in October released Thursday by the site also show that the asking price for an average house in Auckland fell 3.4% compared to the same month last year. That follows a broader 7.5% slide in median property prices in October since the same period last year, according to the Real Estate Institute of New Zealand.

The downturn is not expected to ease soon, with the central bank tipped to continue its yearlong tightening cycle later this month and lift the benchmark rate another 75 basis points to 4.25% to rein in inflation.

That's meant sellers are having to resort to unorthodox ways to promote homes which now take an average of 44 days to sell according to REINZ, nearly double the time it took to do so in early-2021. In a rare exception, Barfoot & Thompson real estate agent Prince Kapoor, who is selling the property, said he was confident they would get in the region of the NZ$1.8 million ($1.1 million) asking price.

“It's 100% going crazy since the ad went up, we're getting a lot of inquiries,” Kapoor said by phone. “We should sell the property within the week.”