Prices drop as housing sector slows

A slowdown in sales of higher priced houses has put a stop to rising prices in the city's residential property market.
Latest real estate institute figures show the median selling price slipped $9000 in August at Mount Maunganui and Papamoa _ and across the harbour the fall was even bigger, more than $12,000.
Real estate bosses said the market was active for properties priced below the $400,000 to $500,000 market but the top end (above $500,000) had slowed.
The buyers were procrastinating at the higher levels _ "if you scratch under the surface at the moment there's nothing much happening", said John O'Donnell, principal of LJ Hooker Mount Maunganui.
"At the Mount 60 to 70 per cent of sales are under $500,000. The higher up you go, there are very few buyers _ these people are not on the move.
"Life is not as exciting as some people would like. There are no great trends in the marketplace and prices are definitely not going up," he said.
Last month at the Mount and Papamoa the median selling price fell to $403,500, from $412,500 in July. The median, however, was still $26,000 above the mark 12 months ago.
On the other side of the harbour the median was back to the levels seen at the start of the year when the market quietened. It dropped to $330,000 in August from $342,500 in July _ and between March and May this year the median ranged from $331,000 to $335,000.
The number of sales were steady in Tauranga, slipping from 146 in July to 141 in August _ and still 40 shy of the volume 12 months ago. But there was a surge of activity on the coastal strip, spurred by renewed interest in the family homes at Papamoa. The volume of sales jumped from 70 in July to 96 last month.
Mr O'Donnell said Papamoa sales had leaped ahead of the Mount over the past three months _ by 15 to 20 properties _ mainly because houses are slightly cheaper there.
Doug Morris, principal of Professionals Papamoa Realty, said people were being drawn to the area because of the extra shopping, cafes and community facilities, such as Fashion Island and the new library.
"Papamoa still has the traditional family home; the Mount has become more intensive and attracts a different buyer who is looking for an investment."
Gil Beadle, marketing manager for Eves and Bayleys, said he expected an increase in the number of higher priced properties in the Spring and Autumn.
"There are fresh listings coming on to the market and I'm sure you'll see a rise in the median," he said.
The Tauranga market, however, reflected the national trend.
Howard Morley, president of New Zealand Real Estate Institute, said August provided evidence prices were flattening.
Mr Morley said the heat that was evident a year ago has gone out of the market but equally he continued to believe there won't be any wholesale reduction in prices.