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Property boom flows into 2017

By Beckie Wilson

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If this was a normal year, the real estate business in Wairarapa would be in the doldrums during the post-holiday season as potential home buyers enjoy the summer break.

But some Wairarapa agents are saying the start to 2017 is the busiest they’ve ever experienced.

Last year saw a surge of interest with buyers from around the country streaming in to get a piece of Wairarapa paradise.

Real estate agents were struggling to meet the demand and they say the boom has flowed into the New Year and simply hasn’t stopped.

Property Brokers Wairarapa regional manager Guy Mordaunt said it could be guaranteed the first week back [to the year] would be quiet while people were still on holiday, but this year, agents had been “flat out” busy dealing with buyer inquiries.

“The start of this year would be the busiest start to a year that I’ve ever seen,” he said.

December had been a big month for Property Brokers right up to Christmas, so it the carry over into the new year meant “it’s unseasonably busy”.

In the past 12 months, the industry had experienced a buyer-driven market, Mr Mordaunt said.

There had been a low number of houses listed in the market compared to the level of buyer interest.

“If buyer demand continues and stock gets even less, that could cause all sorts of things to happen.”

“If the stock gets dangerously low, it forces competition and prices up — from a real estate agent’s point of view and a person selling a house, that’s not a bad thing.”

However, one of Mr Mordaunt’s concerns was the effect of this property boom. Property prices in Wellington went up 25 per cent last year, “if it does that again this year, it is that going to be sustainable.”

Over the past three years, house sale numbers have been on the increase.

Houses selling in double quick time

Last year, Wairarapa houses were selling in half the time for the corresponding period in 2015.

According to REINZ figures, 84 houses were sold in 52 days in December 2015 – it took just 27 days to sell 80 houses in the region in December last year.

Ray White Leaders real estate agent Brad Chittick is experiencing a similar effect from the post-holiday interest.

Ray White Leaders in real estate agent Brad Chittick PHOTO/SUPPLIED
Ray White Leaders in real estate agent Brad Chittick PHOTO/SUPPLIED

“My personal feeling is it’s probably one of the busiest after-Christmas markets that I’ve seen for a long time.”

“From our perspective, the market over Christmas, and particularly through the New Year, has been extremely busy, and the momentum hasn’t really stopped,” he said.

This is great if you’re a home owner because the market had been “sluggish” about 18 months ago.

“For about six or seven years the market had minimal growth – “last year was a bit of a catch-up”.

There had been no signs of it evening out. Nearly every property sold had more than one buyer wanting the same property on the day, he said.

“We are still finding demand is outstripping supply, so effectively all agents can’t get enough listings to satisfy the demand.

“At the moment, we have very affordable interest rates, and you’ve got a market that is growing. The buyers are anxious to buy now before it costs them more tomorrow.”

Every end of the property market was operating in a very positive form, with interest from “across the board”, he added.

Jo-Kelly & Co Realty opened in Carterton late October last year, and are simply trying to keep up with demand. Agent Jo Wisler said interest hasn’t waned since they opened.

“The interest in buying properties is huge, greater than we have ever seen before,” she said.

“This is by far the strongest amount of interest we have ever seen even in the peak of the market in 2007.”

From the end of December, the growth had been phenomenal, she said. The amount of sales in the past two weeks had been high with multi offers on everything sold.

Low rates boost

The increase in buyer demand can be a flow on from the affordable interest rates banks are currently offering.

Wairarapa Building Society (WBS) offers loans and investment options for buyers wanting to purchase residential, rural and commercial property. CEO Kim McCabe said the interest rates have slowing for a while now.

“While rates vary at the discretion of the bank, I don’t see interest rates going anyway far fast,” he said.

“Currently I’m seeing people buying rentals and first home buyers.

“But the biggest growth has been in new builds in the last year.”

Current floating mortgage interest rates per annum offered by the banks are ANZ 5.69 per cent, Westpac 5.65 per cent, ASB 5.68 per cent and Kiwibank 5.40 per cent.

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