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Home / Hawkes Bay Today

House sales hot

By Patrick O'Sullivan
Hawkes Bay Today·
26 Sep, 2015 07:00 PM4 mins to read

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LOCATION: Builder Eric Meinsma is expecting the Havelock North house he has built to sell as higher-bracket sales increase in Hawke's Bay. PHOTO/PAUL TAYLOR

LOCATION: Builder Eric Meinsma is expecting the Havelock North house he has built to sell as higher-bracket sales increase in Hawke's Bay. PHOTO/PAUL TAYLOR

Hawke's Bay real estate is continuing its record run thanks to strong demand and dwindling supply lifting prices.

REINZ August figures showed the volume of house sales for Napier were up 75 per cent on August 2014 and Hastings up 23 per cent, yet the median changed little due to few high-priced houses selling.

Sotheby's managing director Fraser Holland said the situation had changed, with September sales for houses above $600,000 experiencing a "step-change".

Sales activity usually dropped in winter but July saw 19 sales and August 32, he said.

In the million-dollar-plus bracket, more sales were seen in the year to date than for all of 2015.

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Leaders managing director Elanor MacDonald said last month's momentum remained in the market, especially in the lower-to-mid price range.

"There has been some notable sales in the higher prices but the top end is where there is still plenty of supply," she said.

In Hastings, for houses between $200,000 and $400,000, the list-to-sell ratio meant if there were 20 houses on the market 17 would sell within a month.

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While the $700,000-plus bracket was relatively sluggish, it was "hugely" above this time last year.

"It is moving along quite nicely but there is plenty of supply in that part of the market, so buyers have a choice."

Builder Eric Meinsma has had his brand new thermally efficient solar-powered Havelock North house on the market for several months and lately is enjoying a lot more buyer interest.

With a valuation of $770,000, he had been looking for $800,000 but Leaders agent Chris Guilford said he would consider lower offers.

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Mr Meinsma said many people did not realise the value in new houses, built to higher specifications after the Christchurch earthquakes.

"I'm surprised it has taken so long to sell," he said.

"My personal view is there is a disconnect between the old stock on the market and the cost of building today." Ms MacDonald said the majority of the action was still at the lower end of the market - she was seeing up to six offers being made within a week of houses listing.

"Some properties are selling on the first day they are listed, which I personally don't agree with. I don't think it is in the best interests of the person selling.

"They should be at least getting them on to the internet and let us let people know it is available.

"It would be a disservice to pretend we know what the prices are on the day, because we don't. They are moving but they are moving in different areas at different paces," she said.

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"A lot of properties are now being sold with no price - at tender, auction, deadline sale or another form of no-price marketing.

"That is just a case of the agents not being able to clearly ascertain what the sale price will be - yesterday's sales stats aren't supporting today's sales figures."

Property Brokers Hawke's Bay managing director Paul Whitaker said last month's record sales volumes continued, but official price figures did not always tell the true story.

"On the ground we are definitely seeing a lift in prices, but we are definitely seeing a lift in prices across the board. But when you start talking median market prices, it always depends on volumes and the ratio of [low-priced] investment properties, so it can be heavily distorted."

Tremains Real Estate agent Peter Bulpitt said there was a shortage of new land. In the past three months, it had sold 49 sections compared with 26 for the same period last year.

On September 14, there were 14 sections released in Havelock North's Brookfield Estate development, with 13 selling within the week.

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On the same day in Mahora's Northwood development, 14 were also released, with 13 also selling within the week.

He said in Hastings and Napier councils were rezoning land too slowly.

"There are very few sections around and once they're gone I don't know where we'll go," he said.

Sales volumes increased in almost all areas of New Zealand in the three months to August.

The biggest increase was in Waikato with 96 per cent, followed by Coromandel at 91 per cent and Northland at 74 per cent.

"Typically, we see the winter months to be the slower months but the difference in sales volumes in particular is quite significant this year," REINZ chief executive Colleen Milne said.

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She said it would be interesting to see how the upcoming house deposit change and the implementation of the bright-line test, which taxes re-sales in a two-year period, would impact on sales volumes.

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