Northland property prices still rising, with Kawakawa seeing largest increase

Kawakawa is attractive for home buyers with the town having the largest average median price rise in Northland over the past year at 26 per cent - but there's a shortage of rental properties.

First-home buyers made up the largest proportion of buyers in Northland in the past year, and although median property prices have risen across the region, the rate of growth has slowed.

The town with the largest price rise is Kawakawa, which has an average median value of $315,000 - a 26 per cent increase on 12 months ago - but with many of the homes there being bought to live in, it's left the town with a shortage of rental properties.

Figures released by property website OneRoof show that after a period of rapid house price inflation, growth is slowing in the region's three territorial local authorities areas, OneRoof editor Owen Vaughan said.

The figures show that 1618 properties sold in the Whangārei District in the past 12 months, and the Whangārei average median value (AMV) is now $525,000, up 10.5 per cent on the $475,000 AMV last year. In the Far North the AMV is $450,000, 8.4 per cent higher than the $415,000 12 month ago, with 1084 properties sold.

In Kaipara, the AMV is $585,000, or 4.46 per cent up on $560,000 12 months ago, with 446 properties selling.

In the towns and suburbs, Kawakawa has seen the largest increase, up 26 per cent to $315,000; followed by Parihaka, in Whangārei, at $515,000, up 21 per cent and Karikari Peninsula, in the Far North, up 20 per cent to $480,000.

Vaughan said first-home buyers remain the largest group of buyers in Northland, making up 27.6 per cent of new mortgage registrations. Investors (three or more properties) account for 18 per cent.

He said the investor share of new mortgage registrations continues to decline and is significantly below the peaks experienced during the first quarter of 2018.

''With over half of the housing stock in the region transacting for less than $500,000, popularity among first-home buyers is expected to continue,'' Vaughan said.

''In places like Kawakawa it's seen as a good place to buy that first home because the prices are not as high as many other places. It's becoming attractive to first-home buyers rather than investors, and with investment in the town and wider Far North, it's seen as a good place to buy.''

Far North District councillor Kelly Stratford said it's good news for the town that so many properties were being bought to live in, but the downside meant that Kawakawa had a serious shortage of rental properties.

Stratford used to live in Kawakawa, but said she's now being priced out of the market and is renting elsewhere in the Bay.

She sold her first home in Kawakawa around 2004 at the height of the last property boom, then bought another property in Kawakawa that she and her partner had to sell when their work circumstances changed. She's now renting as she cannot afford to buy back in the town at this stage.

"Many of the homes are being bought by people who are coming back home, which is wonderful for the town and really helps the community. Also people [are] moving here from other places that have seen their property prices there soar and it's cheaper here,'' Stratford said.

''But there are now very much fewer rental properties around in the town. There's hardly anything at the moment and it also means that rental costs are rising.''

Stratford said she can see the appeal of Kawakawa.

''It's a great little town, with a real sense of community. We talk to each other here and people care.''

As well, the town was starting to see some serious investment and opportunities, such as Te Hononga, a $6.4 million rammed-earth building taking shape behind the town's famous loos, which will include a public library, council service centre, gallery, workshop, toilets for freedom campers, and an interpretative centre exploring the relationship between Kawakawa and Austrian artist Friedensreich Hundertwasser.

"We're totally connected to ultra-fast broadband; our wonderful vintage railway and of course the cycle trail,'' she said.

''The cycle trail is bringing in serious visitor numbers. I was at a cafe in town and counted 20 bicycles outside at one time from people doing the cycle trail - and more were coming through the day. It's a great time for Kawakawa.''

Nationwide, value growth is still evident in the market, with the median value increasing just under 5 per cent to $577,000.

This growth has been mostly fuelled by strong house price inflation in many smaller regional centres, Vaughan said.