Tauranga house values stagnate

House values in Tauranga remain stuck at levels seen five years ago - and there's little sign of a pick-up in prices.
Traditionally, Tauranga has followed a rampant Auckland residential property market. But not this time.
While values have gone past the peak of late 2007 in central Auckland, they are still 10-15 per cent below in Tauranga.
"We aren't following the Auckland trend," said Roger Hills, a director of Hills Haden.
"Not many houses are being built, the investors have disappeared, and there doesn't seem to be a shortage of housing like in Auckland.
"We can only surmise that people have stopped coming to live in Tauranga. The market always comes down to supply and demand."
Mr Hills said the present Tauranga values were at 2006 levels - and they got even higher through to October 2007. He said values rose slightly early last year but those gains were clawed back by the end of the year.
Mr Hills said even though sales volume has improved this year prices haven't lifted. "The reality is we had a lot of growth in the mid-2000s. The market got away from us and now it's a catch-up period.
"A market without capital growth doesn't provide the same incentive. We are not seeing masses of investors and it's expensive to build. People are just sitting and waiting," he said.
The latest QV Valuations survey showed Tauranga house values, for the three months ending June, were 1.8 per cent lower than the same period last year.
QV said the steady trend for values seen in the past few months has continued. Shayne Donovan-Grammer, of QV Valuations in Tauranga, said the property market continued to be subdued.
"This, to some degree, is to be expected for this time of the year. Winter has never been the peak selling season."
He said overall the market was following a predictable pattern given what has played out over the past two years, when prices and volume fell significantly.
Mr Donovan-Grammer said a few of the sections that had sold fetched lower than expected prices.
Tauranga, however, remains the third most expensive area outside of the Auckland region. Tauranga's average sales price, for the three months ending June, was $415,418 - slightly ahead of $411,235 for the May period. The Western Bay of Plenty district including Katikati, Omokoroa, Te Puna and Te Puke, had a 0.5 per cent growth in values and its average sales price was $402,449. Tauranga was behind Queenstown Lakes with an average price of $585,561 and Wellington $514,982. Christchurch values are presently not included because of the effects of the earthquakes.
The national market was being driven by rising values in the Auckland region. QV.co.nz research director, Jonno Ingerson, said nationwide property values increased in June after previously remaining relatively stable for several months.
He said the gap in values between June this year and last year had closed to 0.9 per cent, and values were now 5.2 per cent below the market peak of late 2007. "Much of the gain in nationwide values can be attributed to increases in the Auckland area. Apart from a minor hiccup in March, values have increased by over 2 per cent in greater Auckland since January."
In Auckland city values grew 2.6 per cent to the end of June (compared with the same period last year) and its average sales price was $610,445. North Shore was $610,103, Manukau $459,396 and Waitakere $402,459. Hamilton's June values are 3.6 per cent behind last year's and its average sales price was $339,065.