House sales up but prices flat

By Ellen Irvine


House prices remain flat in Tauranga despite more homes being sold and an increase in buyers.

QV Tauranga valuer Paul Thomas said higher sales volumes had not yet had a positive effect on values - and the average house price still lags 11.8 per cent behind the 2007 peak.

But agents are optimistic the market is slowly coming right, with Harcourts reporting its best January since 2005.

Simon Martin, managing director of Harcourts Advantage Realty, said there had been a marked increase in enquiry from buyers in all categories, but supply and demand remained consistent.

The number of people turning up at open homes had increased substantially, he said.

Hottest properties in January were those going for less than $400,000.

Ross Stanway, chief executive of Realty Services, said low interest rates, finance availability and competition between banks contributed to a Tauranga property market in "great shape". While Tauranga prices have failed to improve like those in Auckland or Christchurch, that could soon change.

"Confidence is returning in the development sector so there's now some movement in sections, and new sections becoming available.

"That's started to gather some momentum - we probably are at a stage in the cycle where, if anything, prices will just start to show some upward pressure particularly in middle market."

That middle market is selling best with three to four bedroom family homes in top demand.

Greg Purcell, franchise owner of Ray White Realty in Mount Maunganui and Papamoa, said one of the biggest trends in the past six months was plenty of multi-offers on some houses.

But other houses are still failing to attract buyer interest.

A recent auction of a Campbell Rd home attracted seven potential buyers and four bidders, something which "wouldn't have happened" two to three years ago.

Mr Purcell expected a continuation of last year's real estate market - healthy but unpredictable.

A busy start to the year had tailed off, and prices will increase only if demand starts to outstrip supply.

Half of all houses that changed hands in January were sold for under $320,000, down from $360,000 the year before.

LJ Hooker Franchise owner Neville Falconer believed prices were now as low as they would go.

- Bay of Plenty Times

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