House values lift in Bay's lower-priced suburbs

By Patrick O'Sullivan

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House prices in Frimley have more than doubled since 2003 because of the Frimley Estate residential development in the Hastings suburb, according to a property report from My Valuer.

Lower-priced suburbs prices enjoyed good price rises in Napier and Hastings last year, while the upper end of the market remained stable.

The Napier suburb of Maraenui had the biggest gain in 2003 with 13.9 per cent, matched by Hastings' Mahora, closely followed by nearby Camberley with 13.1 per cent.

Valuer Andrew White of My Valuer said the higher price bracket was less active last year but good properties in the $700,000 to $1,000,000 price bracket had sold, "albeit many less than original vendor expectations".

"Overall, residential house prices have shown a marginal lift in median sell price, though in some situations, it hasn't been enough of a correction for those who purchased at the peak of the property cycle; between 2007 up to about 2009," he said.

"This is particularly evident with regards residential investment property, which was a very active and heated market sector at this time.

He said the Reserve Bank's effort to stymie the booming Auckland market with Loan to Value Ratio (LVR) restrictions in October "has certainly put the brakes on the first home buyers ability to buy in Hawkes Bay".

CoreLogic figures show the number of Napier first-home buyers fell from 21.2 per cent of home buyers at the start of the year to 15.8 per cent at the end for a drop of 5.4 per cent. Hastings first-home buyers dropped 3.6 per cent.

"We always say, the first home buyer is an integral cog in the property cycle," Mr White said.

"Without them, the second home buyers can't make the jump up the property ladder."

Sale volumes remained steady through the latter part of 2013, but with fewer lower-priced properties sold because of the Reserve Bank restrictions on low deposits, the median sale price for Napier and Hastings rose.

"The LVR restriction is also putting pressure on the residential rental sector, with increased demand for rental properties. This will ultimately culminate in increased rent demand from landlords."

Havelock North was also stable last year with a rise of 1.2 per cent.

The towns of Waipawa, Dannevirke and Wairoa experienced price drops last year, the largest being Wairoa at 20.8 per cent. Since 2008 prices have dropped 51.3 per cent, but are still 64.8 per cent up on 2003.

Waipawa dropped 6 per cent and Dannevirke 9.6 per cent.

Waipukurau was the only town to show a median price rise at 1.1 per cent.

Hastings' Camberley prices rose 77.3 in the decade and 17 per cent in the past five years.

In Napier, Tamatea saw the biggest increase in sale price for the decade at 69.8 per cent followed by Pirimai on 67.7 per cent.

Ahuriri had the lowest decade increase at 24.4 per cent.

After its decade doubling Frimley was stable last year with a rise of 0.3 per cent.

Property Brokers Hawke's Bay manager Paul Whitaker said Reserve Bank restriction on low-deposit mortgages had stopped the market from gaining momentum.

"Investors have probably got the jump at the moment, most know they have to have 20 per cent equity and are geared that way," he said.

There would likely be a catch-up period once the restriction was lifted.

"Definitely the banks have money to lend. The restrictions are just delaying the inevitable."

- HAWKES BAY TODAY

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