Central Tauranga the place to be as median values surge

Mount Maunganui and Papamoa Ray White Realty Focus franchise owner Greg Purcell outside a property that has sold recently. Photo/file

Tauranga 's more central suburbs have continued to record solid increases in median value increases in the latest QV Quarterly Property Report.

Brookfield recorded the biggest percentage increase in median value since the last peak of the property market in October 2007, rising 52.3 per cent to $534,400 in January this year, and was up 74.7 per cent over the last five years.

Other suburbs have shown similarly strong increases over the past five years, with houses in Judea up 104.6 per cent, and Greerton up 65.9 per cent.

The biggest increases in Tauranga suburbs in the past 12 months were Maungatapu (up 24 per cent), Parkvale (up 22.3 per cent), Welcome Bay (up 22.7 per cent), and Greerton (up 22.2 per cent).

Western Bay of Plenty suburbs also showed strong growth, reflecting an increasing willingness on the part of buyers to commute to obtain suitable housing, said property agents. (see accompanying story).

Property experts cautioned that the median value figures could be slightly skewed because of the impact of new bank lending restrictions in reducing sales of lower-priced houses.

While first home buyers were now coming back into the market, mid and higher priced properties were tending to sell more easily, they said.

"We are seeing a bit of two-tiered market where you've got investor product that has been affected by the bank lending restrictions," said David Hume, QV valuer in the Bay of Plenty.

Chief executive of Realty Services, which operates Bayleys and Evens, Simon Anderson says it is getting a real range of buyers looking at properties. Photo/file

"Anything over $600,000 is generally more of your owner-occupier product and hasn't been affected as much. Then you've got your higher end property, which seems to be doing pretty well. We're still seeing good results at the lower end, but it's probably just a bit more normalised than it was."

Mr Hume said there were signs the market was stabilising after the frantic buying of the past couple of years, but it would take another couple of months before the trend became clear.

However, he noted that median value percentage increases over the past quarter were tending to be lower than in the previous quarter.

Greg Purcell, owner of Ray White Realty Papamoa/Mount Maunganui, said the skewed values had been evident towards the end of last year, when the bottom end of the market dried up.

"It made it appear like everything had shot up in price, when the reality was more of the middle market was selling."

Harcourts Tauranga managing director Simon Martin said the volume of sales at lower end of the market had slowed because the investors had pulled out.

"The values of properties that are selling are higher priced so some of those lower priced areas are showing increased [median] values."

Simon Anderson, chief executive of Realty Services, which operates Bayleys and Eve's Realty, said it was getting a real range of buyers looking at properties.

"The lending restrictions have had an impact on the investor market," he said.

"We've certainly seen that first home buyer business coming back in now they know they won't be competing against investors as hard as they were. But we're also seeing a lot of high value properties selling."

He agreed the market appeared to be stabilising.

"We've had a pretty strong run, so it's not surprising the market is taking a bit of a breather. But all of the signals are still pretty positive around the job market and immigration."

Priority One project manager Annie Hill said the rise in median values - especially in well-located areas with good amenities - reflected the continuing attraction of Tauranga as a place to live and work.

"We were working with about 10 people a week last year looking for jobs here," she said.

"I'm now working with 10 people a day - there's been that much increase in the interest in living here."

Western Bay's big rise

The Western Bay of Plenty saw some of the biggest rises in median value over the past 12 months. Pukehina was up 30 per cent, with the highest median value of $617,700 last month.

Te Puke was up 26.6 per cent, Omokoroa 25.2 per cent, Katikati 21.7 per cent, and Waihi Beach 16.8 per cent.

Greg Purcell, owner of Ray White Realty Papamoa/Mount Maunganui said he had noticed that more first home buyers were willing to buy on the periphery of Tauranga.

"People are starting to do the equivalent of the Auckland commute thing," he said, noting increased interested in areas such as Pukehina, and Paengaroa.

"And that's about affordability."