Sales slow but prices go up

Norma and Frank Hinds are surprised at all the interest in their open home. Photo / George Novak

The average sale price of Tauranga properties has been increasing in the past year as lending restrictions slow sales at the lower end of the market.

Quotable Value Residential Price Movement Index statistics for the past 12 months show in each month, the average sale price of Tauranga properties increased compared to the same month the year before, with a spike in sale prices after loan-to-value ratio (LVR) restrictions were introduced on October 1, 2013.

In August, the average sale price rose 5.1 per cent compared to the previous year.

Simon Martin, managing director of Tauranga Harcourts, said the properties selling now were of a slightly higher value than previously as the LVR restrictions were still pushing the median sale price up.

Mr Martin said prices were stable as supply and demand had not altered much.

There had been a drop in volume in the Tauranga market up until August, but this appeared to be improving.

Open homes were attracting more people, he said.

"That's been a bit of a surge, and in turn that indicates a surge in sales in coming weeks.

"I think after the election as well we may see a lift in activity," Mr Martin said.

Karen Worley, marketing manager at Tauranga Realty Services which operates Eves and Bayleys, said a shortage of listings meant multiple offers on properties which, in turn, pushed prices up.

Mrs Worley said she expected a typical spring and that more listings would come in the short to medium term.

A big month of sales in Mount Maunganui and Papamoa meant there was a shortage of stock in those areas, so there may be further price rises, she said.

Neville Falconer, LJ Hooker Bay of Plenty franchise owner, said it was a "no brainer" that LVR regulations eliminated sales in the lower bracket.

More sales in the middle and high end of the property market pushed the median sale price up.

Mr Falconer said the LVR restrictions should have been related to geographic location and aimed at Auckland and Christchurch, rather than affecting the whole country.

QV registered valuer Mairi Macdonald said the Tauranga market was still steady with good demand for property, although sales volumes were down and there was slightly less activity in the entry level end of the market.

"Suburbs like Bethlehem, Otumoetai and Pyes Pa are still selling well although sales volumes in Mt Maunganui and Papamoa have decreased," Ms Macdonald said.

Offers line up after open day

Norma Hinds and her husband Frank have been living in the same house in Matua for the past 18 years.

The couple, both in their 80s, decided it was time to downsize while they still could.

Mrs Hinds said their three-bedroom house had a "caravan" open home, where Eves real estate representatives brought potential buyers to their house on one day.

The first group came through at 9.30am one morning and, from then on for the rest of the day, there was a constant stream of people through the house.

"In a matter of days we had three offers."

Mrs Hinds said she was surprised at the number of people who looked through their house but was happy with the response.

The couple were expecting to find out today whether the offer they accepted had became unconditional.

Mrs Hinds said if the offer went through they were very happy with the price they were getting.

The couple would be moving into the Bob Owens retirement village in Bethlehem. "The house is too big, with all the gardens and maintenance.

"It seemed to be a good idea to move, as we have a lot of friends there too."

- Ruth Keber