Bay still a haven for first home buyers

By Sam Hurley, Teuila Fuatai


As national house prices soar to new highs, Hawke's Bay is being hailed as a great market for first- home buyers because of its cheap properties.

The region's median house price edged to $282,000 last month, up from $281,000 in March 2012.

However, this was significantly lower than the national median of $400,000 - a new record high.

The figures were revealed in the latest Real Estate Institute of New Zealand (REINZ) property report.

Soaring national prices have been blamed on skyrocketing house prices in Auckland and Christchurch.

In Auckland, the median house price reached $562,000, and Canterbury/Westland recorded $359,000 - both regional peaks. But while city dwellers struggled with outrageous prices and tense auctions, buyers in the Hawke's Bay and much of provincial New Zealand enjoyed a more leisurely property market run.

Hawke's Bay mortgage broker Wayne Holden said residents earning about $45,000 were likely to find a decent, affordable home in the Hawke's Bay.

According to Stats NZ, the median household income in the Hawke's Bay and Gisborne region was $55,800. Hawke's Bay-specific figures were unavailable.

Mr Holden said low property prices were ideal for new house hunters, however some buyers had been caught out by excess debt levels.

"Most young people have short-term debt, because they've just started off and they've had to buy their car.

"Or a couple may have just got together - they're an item and they've got to buy furniture."

Real Estate Institute of New Zealand's Hawke's Bay group chairman Murray Keane said Hawke's Bay property sales had remained consistent but that young buyers were becoming more prevalent in the market.

"Prices have remained steady but first time buyers were increasing the sales."

He said that property investors had also returned and were looking to capitalise on the regions lower prices.

"Hastings and Napier in particular have seen investors increase sale numbers, but Napier, unfortunately, is still waiting for Auckland investors to join the market."

Banks were often reluctant to take on this "short-term" debt, which made it difficult for people to get home loans, he warned.

REINZ chief executive Helen O'Sullivan said the national median price jumped 8.1 per cent or $30,000 in the year to March.

Ninety per cent of this increase was from price movements in Auckland and Canterbury/Westland.

"Together these two regions represent 52 per cent of national house sales, indicating that the remaining 10 per cent of the increase came from the remaining 10 regions, which cover 84 per cent of New Zealand geographically."

Ms O'Sullivan said supply shortages in the Auckland and Christchurch property markets had resulted in "double digit price increase and new record prices", in March.

The number of days to sell also reached near-record lows.

Overall, about 8000 residential sales occurred nationwide last month.

Most regions saw an increase in year-on-year sales volume, with Northland registering the largest jump (43 per cent), followed by Auckland (17 per cent) and Waikato/Bay of Plenty (15 per cent).

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- Hawkes Bay Today

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