James and Annie Offord with their children Silvia, 4, Melody, 5, and baby Niko. Photo / Supplied
A Rotorua father-of-three sold his beloved drift car and gave up being self-employed so he and his wife could buy their first home.
The young family share their story of success as cautious home buyers play a “big waiting game”, experts say, while property prices continue to fall.
The Real Estate Institute of New Zealand’s latest data shows Rotorua’s median house price dropped 9.6 per cent - or $60,000 - to $685,000 in November. Annually, it rose 0.7 per cent - or $5000 - from $680,000 in November 2021. A total of 67 properties sold in Rotorua last month compared to 88 in November 2021.
James and Annie Offord moved to Rotorua from Palmerston North in August 2021.
“Our goal was to rent for a couple of months and then look to buy.”
But the day they moved up, the country went into another Covid-19 lockdown.
“Everything fell pear-shaped,” James said.
Once everything started to return to normal, the pair re-started their property hunt and enlisted a mortgage broker.
But James said they were told there was no hope as he was a self-employed painter and Annie was a stay-at-home mum at the time.
So James said he “packed in” the business and applied for a job working for someone else.
Then, about eight months ago, they got a letter from their landlord saying the house was going to be put on the market.
“It meant we had 90 days to find a new place. We were so stressed. We had a newborn, two girls, and there was the stress of them having to start a new school and kindergarten.”
The pair ramped up their house hunt but found nothing within their $400,000 budget. James said the city’s median house price of $685,000 was “crazy”.
“That is why we started to give up hope because we couldn’t get anything for that price.”
But just as they were about to give up, Annie found a three-bedroom home in Pukehangi that ticked all the boxes.
“We were pretty determined. We had probably looked at about 30 houses before we found this one.”
Real estate salesman Chander Sandhu was packing up after an open home and invited them in to have a look.
The pair visited their mortgage broker once again and “everything sort of fell into place in the space of about a week”.
“We had gone from stressing out about finding a home to we are about to own one.”
The pair had gathered enough money for a 10 per cent deposit after selling James’ drift car and scaling back their hobby to stock cars and racing locally instead of travelling all of the time - as well as other “small things” like not eating expensive foods.
The pair had a combined KiwiSaver total of about $30,000, and with the help of both their parents, that got them over the 20 per cent threshold to buy their home for $465,000.
“We were pretty lucky.”
James said when they got the keys in mid-August this year, he was straight in with his paintbrush painting the walls.
“That is the best thing about owning your own house is you can do what you want and make it your own.”
He said being able to have secured a home for their children Silvia, 4, Melody, 5, and baby Niko was “amazing”.
“It is a real buzz.”
His advice to other first-home buyers was to keep going.
“I know it sounds cheesy, but don’t give up.”
REINZ regional director Neville Falconer said owner-occupiers were dominant in the market, with first-home buyers also active.
“Open homes have been quiet, largely due to current market conditions and economic uncertainty. Buyers are finding it difficult to obtain finance in time, and some have indicated placing a hold on their buying plans until the New Year.”
Falconer said there was still a steady number of listings entering the market but there was no sign of the usual spring flurry in market activity.
“Local salespeople say that until economic conditions improve, they don’t expect a significant increase in buying and selling activity.”
Rotorua Professionals McDowell Real Estate principal Steve Lovegrove said buyer activity was significantly subdued.
“People are extremely cautious, prices may drop further. It is a big waiting game.”
First-home buyers were not particularly active as they were concerned they might lose value before they gain it, he said.
“The only people who are buying are those who need to. Anyone who doesn’t just isn’t.”
Lovegrove said he believed property prices would continue to drop and vendors needed to reduce their prices if they wanted to sell.
First National principal and Rotorua REINZ spokeswoman Ann Crossley said sales volumes had significantly dropped and first-home buyers were also taking “all the time in the world”.
“November is usually a busy month but this November felt very flat.”
However, Crossley said there were still 67 sales.
“If you asked me whether you should buy now or if you should wait, the rule is now is always the best time to buy.”
Crossley said the good thing was there was plenty of property for buyers to choose from.
“There are some nice first homes out there for people. We are lucky in Rotorua that our first homes are affordable.”
Ray White Rotorua real estate salesman Chander Sandhu said November was a strange month for the property market.
“Everyone was expecting a flood of listings to come in spring, which has not happened.”
Sandhu said first-home buyers were active but were hesitant to make a move in the market.
“They are hearing news the prices are going to drop and are caught in a trap of whether to buy now or wait.
“Some are now leaving it to the New Year to start looking again.”
However, he said in the past month, he had sold three properties to first-home buyers who were aged in their 30s and a young family was about to settle on their first home this week.
“All first-home buyers that have bought recently are so happy to be finally celebrating Christmas in their own home and are feeling proud and accomplished.”
Heading into the New Year, Sandhu said he expected more listings to come to the market and more property deals signed.
Managing director of the Realty Group, which operates Eves and Bayleys, Heath Young said the drop in prices of up to 10 per cent in some areas of the Bay of Plenty was good for first-home buyers and better results were starting to be seen in the auction rooms.
“All buyers at the moment have to weigh up these better prices with increased financing costs along with perhaps having to sell their own property.”
Tauranga City
November 2022: $902,000
October 2022: $900,000
November 2021: $1,000,000
Rotorua
November 2022: $685,000
October 2022: $625,000
November 2021: $680,000
Kawerau
November 2022: -
October 2022: -
November 2021: $420,000
Ōpōtiki
November 2022: $350,000
October 2022: $365,000
November 2021: $570,000
Western Bay of Plenty
November 2022: $1,080,000
October 2022: $860,000
November 2021: $985,000
Whakatane
November 2022: $719,000
October 2022: $590,000
November 2021: $703,000
Bay of Plenty
November 2022: $857,000
October 2022: $840,000
November 2021: $890,000
Source: Real Estate Institute of New Zealand
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