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Prices high, stock low

Street view of houses in Masterton. PHOTO/KAREN COLTMAN

Kiwis need change in property psyche

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The number of Wairarapa houses for sale in February was down by over a third on this time a year ago, but asking prices were up 26.6 per cent on last year.

The February property report from realestate.co.nz shows 36.3 per cent fewer Wairarapa houses were on the market in February than 12 months ago.

This is the second biggest drop in listings in any region for that period. But the lack of property has created a ‘seller’s market’ and a driver for the region getting all-time high sale prices.

The average asking price in Wairarapa last month was $595,741, which made it one of five regions to record an all-time high since records began 13 years ago.

Masterton Ray White real estate agent Jude Clark said that when the sale price of houses goes up and people weigh up selling, they are also working out what they can do next.

“If they list their house it can sell very fast in a hot market and this means they need to be able to buy something else fairly quickly in a competitive market,” Clark said.

“If a retired person looks to sell and downsize, they are still having to pay a top price for a smaller but more modern place sometimes. Weighing up these things means it doesn’t always add up to sell.

“This is still a seller’s market and yes if you can sell great, but if you must buy again well, you’re not gaining much as you are buying in this hot market.

“Sometimes you even need more money to buy a better home.”

She said houses are coming to market and over the 2019 year the number of houses bought and sold was about the same as the previous year.

“Because they are selling fast, they can come on the market and off in a month.”

Wairarapa had 127 new listings last month, up 8.5 per cent on February, 2019.

Realestate.co.nz head of sales and marketing Vanessa Taylor said that lack of house listings could be a result of the Global Financial Crisis of 2007 to 2013, which led to a house building halt.

“When the GFC hit, we stopped building and now we are experiencing the hangover from this quiet period and are struggling to meet the demand for housing,” Taylor said.

“Healthy prices are likely being driven by this lack of supply.”

Taylor said that high-density housing could have success in New Zealand if kiwis changed their psyche.

“Many are hanging on to the quarter-acre dream. People want affordability and homes that support their lifestyles. I think we will see a shift in the sorts of homes being built and in how developers start to present the ‘back garden’ that kiwis love so much.

“We have a lot of builders that build three of four homes a year. If we start to look at how the building market can better supply modern New Zealanders, I think we will find new opportunities to scale up the amount of builds with better technology and kitset style homes like are being constructed in Japan for example.”

Throughout New Zealand property listings are in in short supply. Nationally there were 22.3 per cent less homes for sale in February 2020 than 2019.

But for people looking to buy, Real Estate Institute of New Zealand chief executive Bindi Norwell, said there is increasing confidence across the country.

“With increasing confidence levels across the country from first time buyers, investors and owner occupiers, it’s great to see more listings come to the market – particularly in areas where there has been a significant shortage of properties over the last few months,” Norwell said.

“We look forward to seeing how this increase of new listings plays out.”

The average asking price nationally for February was $702,510, four per cent higher than February last year.

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