The REAL estate school of economics

With Auckland property prices scaling the heights, it's easy to assume a domino effect will ensue for the Far North. But will it? Is it time to sell up? To buy anew? These are age-old dinner-party questions and if you're in the real estate business you're expected to provide an answer by the time dessert is served.

A dozen or so years ago Real Kerikeri was owned by lawyers. Cynics might suggest that's like rabbits let loose among ripe and ready carrots but in 2005 the company was purchased by two long-time Bay of Islands residents who weren't in the legal profession. Pete Hendl arrived here 40 years ago, when Kerikeri was little more than a main street and some orchards, and Steve de Ruiter moved to Kerikeri in the mid-eighties. They certainly knew the town.

Significantly, and most unusually in a commission-based industry, they run the business as a collective which allows their agents an equal share of all commissions generated and Steve de Ruiter believes the rest of the world will eventually follow their operating example.

We are asked how we can run a system like this and I say how can we not? There is enough competition in the marketplace without having to compete with your work colleagues. How can you call yourself a team and not trust each other? he asks with justification.

Commission-based selling means you stand alone so the closer you work together to combine your skills and knowledge the better. It doesn't just benefit us, it benefits the client because we all have an equal interest in making sure they are looked after.

Moreover, and again uncommonly, neither does the company charge vendors for marketing. It means the seller, faced with moving and legal expenses anyway, doesn't have to stump up even more for advertising at a time when, most likely, they can't afford it.

So, how's the real estate market-place faring right now and is there an answer to some of those elusive questions? Peter Hendl says there's considerable inquiry coming from Auckland and Christchurch.

The greater number who want to live here come from Auckland and want to play golf and to fish. But we're getting a lot of inquiry from couples with young families from Christchurch who have sold their house, love the environment here and tell us the town is vibrant. And we have people who have left Kerikeri for job opportunities elsewhere but say they want to come back.

For the moment the number of houses available for sale is relatively low, put down to the fact there hasn't been any concerted new-house building in Kerikeri and surrounds for the past four years. But as history records it doesn't always stay that way and Mr Hendl believes this region is poised on the upward curve.

If supply is low, as it is at the moment, you either get development or prices go up. With people coming in you get momentum which stimulates the retail industry and I think we're at that tipping point right now.

If today it's a buyer's market both these agents state clearly this can change like the seasons and is dependent on a number of sometimes indeterminate factors like exchange rates, job opportunities, lifestyle choices, whether the vendor feels the time is right and if there's a buyer waiting off stage.

It's known as the supply-and-demand school of economics and that hasn't changed, no matter what the product, in centuries. But if sitting pretty is an important buying criterion then the Bay of Islands is well placed to be ticked on the list.