The total value of homes sold in the Tauranga area this year is set to top $2 billion; breaking last year's record.
The number of million-dollar homes sold in the region this year has reached an all-time high.
Tauranga, Mount Maunganui and Papamoa's burgeoning house prices are reflected in the number of million-dollar-plus homes sold this year, which already stands at a record 239. In 2011, the number was just 48.
The latest figures from the Real Estate Institute show that $1.98b worth of homes were sold in Tauranga, Mount Maunganui and Papamoa between January and the end of October. Assuming sales have continued in a similar vein this month, last year's record $2.08b total value of sales would already have been broken.
However, the Institute's figures for the number of homes being sold were not so strong. Some 3036 homes were sold by the end of October, still well short of the 3854 homes sold in the whole of last year.
The numbers of homes sold in the individual regions of Mount Maunganui, Papamoa, Tauranga, Rotorua and the Eastern Bay of Plenty were all lower in October than they were two months earlier.
Real estate insiders blamed the weather for lower sales volumes and suggested that strong regional growth would prevent house prices from falling.
Realty group chief executive Ross Stanway said the $2b figure was a natural result of homes increasing in value in the past year.
Mr Stanway said he believed the sluggish figures for the numbers of homes being sold throughout the region was a reflection of a cold, wet winter, rather than buyer resistance to the growing prices.
The supply of homes onto the market had grown this month with the improving weather.
"We might see a levelling-off in the rate of price increase, but we're unlikely to see any major correction," Mr Stanway said. "The level of activity and interest in our region won't change."
Tauranga Harcourts franchise owner Max Martin said there had been a shortage of property on the market during winter and suggested that new loan-to-value (LVR) bank mortgage rules had temporarily suppressed demand.
Since last month,banks have been restricted in the number of mortgages they can offer to people with deposits of less than 20 per cent (owner/occupiers) or 40 per cent (investors).
The number of properties on the market "wasn't huge", and this was "surprising, considering how many properties are being built", Mr Martin said.
Mr Martin said he believed that owners were holding on to investment properties and suggested now was a good time to sell.
"Summertime is traditionally busy, and the volumes will start to increase."
When asked for his thoughts on the future, Mr Martin echoed Mr Stanway's belief that the market would flatten, rather than dip.
"We'll have a slight rise, but not the dramatic rises we had last year."
Lindsay Richards, a full-time property investor, said people were reluctant to sell because they believed the market was yet to peak.
"People in Tauranga are holding on to properties because they know it's a good investment," he said. "Why would you sell?"
Mr Richards said he believed that Auckland's market had peaked but Tauranga could still rise in the next year.
Number of $1 million+ homes sold
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