Prices firm as property market heats up

The property market in Hawke's Bay is heating up.

Demand for houses continues to outstrip supply, although a flood of property sales at the medium to lower end are masking rising prices.

Leaders managing director Elanor MacDonald said sale prices, compared with council valuations, were steadily "creeping up" but the top end of the market had "a lot of availability and limited sales".

"You'll see the median price go up when we get more action in the top end."

Property Brokers Hawke's Bay manager Paul Whitaker said the market was clearly heading up.

"The sales volume trend is continuing - it's not just a blip," he said.

"The market has a very strong trend and I don't think we will see that changing soon.

"Demand is still strong, outstripping supply, and prices are firming."

The "usual spring volumes" of new listings were coming on to the market "but because of market over-heating it is only just catching up".

REINZ figures released yesterday show September sales volumes rose 34 per cent compared with September 2014 and were up 4 per cent from August, yet the median house price fell 2 per cent from the previous month.

The Napier median price jumped 10 per cent from August to $337,500 but Hastings fell 4 per cent to $265,500 and Dannevirke fell 16 per cent to $127,500.

Hawke's Bay Country, which includes Haumoana and Te Awanga, fell 22 per cent from August to $282,500 but was well up on September 2014's median price of $137,500.

The median Hawke's Bay price fell from $285,000 in August to $279,000 in September, but was up $20,500 from September last year.

There were 263 Hawke's Bay September house sales, up from 255 in August and 196 in September last year.

Tremain Real Estate managing director Simon Tremain said the median sale price had not lifted from August because there was excess supply.

"We are earning good prices but the median price is still not moving.

"The only reason can be because our market still has stock in the lower end where first-home buyers, a lot of the investors and speculators operate," Mr Tremain said.

With real estate agents sitting on stock there was still "good opportunity" for buyers.

"We think this market will be around for a little while yet."

REINZ chief executive Colleen Milne said an easing of LVR restrictions outside Auckland next month would enable more low-deposit lending for first-home buyers "but may add to the consequential shortage of listings in their range".

"There is continued evidence of Auckland investors and first-home buyers spreading to other regions, causing a halo effect, most notably in Northland and Waikato/Bay of Plenty," she said.

"These regions have recorded very strong sales growth so far during 2015, and this is now starting to be seen in the median price data."

Nationally, sale volumes were up 38 per cent up on September 2014 and 5 per cent up on August.

The national median price was $484,650 for September, $64,650 up on September 2014, for a new record high. The price was 4.2 per cent higher than the previous month. The median number of days to sell lowered four days from August to 39 days.

In Auckland it was 29.