House sales up, values remain static

By John Cousins

1 comment

Tauranga has notched up its best house sales month for nearly four years with 152 properties changing hands in March.

But because most of the sales were at the lower end of the market, the increased activity did not translate into higher values.

The apparent contradiction was highlighted by QV's statistics for March that showed the average value of a house in Tauranga had increased by a mere 0.3 per cent to $428,000 compared with March 2012.

At the same time, the latest unofficial Real Estate Institute figures for Tauranga showed the volume of sales in March was just one short of the previous best month, June 2009.

LJ Hooker franchise owner Neville Falconer said the 152 sales in March was encouraging, but it was fascinating to see how steady the average house price had been.

He said the median or mid-point of Tauranga's sales prices had been well below the average selling price for a long time, indicating how busy the lower end of the market had been. In February, the median house price was $360,000 while the average was $403,000.

"It showed that the bulk of activity was well below the average price. That is really good for folks that are wanting to get into the housing market."

"If demand holds, prices will start to move."

QV Tauranga valuer Paul Thomas said values were not heading in any positive direction. Tauranga had corrected itself since the 2007 market peak and the average current value was 10.8 per cent below this peak.

Overall, the picture was not as buoyant as they would have liked. A bit more development and the creation of a few more jobs would put up the figures. Keeping more of the 18 to 25-year-old age group in Tauranga would help. "Tauranga needs that little bit extra ... we are playing the waiting game."

Harcourts Tauranga managing director Simon Martin said the bulk of sales in Tauranga had been under $400,000. Some of the houses on the market for a long time were starting to move because owners were more realistic and banks were lending more. "Values have come back to a point where people now see Tauranga as good value. Quite a few people from Auckland are coming down."

Ray White Real Estate principal Greg Purcell said their auction last week across a range of property values saw a house sell for a million dollars at the Mount and one for $585,000 at Papamoa.

Properties of less value that he thought would be more attractive to a wider audience did not sell. "So what do you say?"

- Bay of Plenty Times

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