House sales up and prices down for Rotorua

FILE

Rotorua house sales were on the up in March as the median price dropped more than 20 per cent from the previous month, latest real estate industry figures show.

Real Estate Institute of New Zealand (REINZ) monthly sales analysis figures showed 86 houses were sold in Rotorua in March, compared to 70 in February - a 22.9 per cent increase.

In contrast 87 houses were sold in March last year.

However the median house price dropped from $288,000 in February down to $225,000 in March - a reduction of 21.8 per cent. In March last year the median price was $256,000.

Professionals McDowell Real Estate owner Ian McDowell said renewed interest from investors for houses in the $200,000 or less price range was driving sales.

"Homeowners were also looking to upgrade and there was plenty of interest in houses priced between $350,000 to $500,000 range," he said.

The increase in house sales was not a reflection of the local economy improving.

"We need population growth to get the economy moving, at the moment Rotorua's population is static."

Taupo and rural Eastern Bay of Plenty showed more improvement than their larger neighbour.

In Taupo, median house prices rose from $298,000 in February to $348,000 in March - a jump of 16.8 per cent.

There were 49 houses sold in Taupo in March, compared to 43 in February - a 14 per cent rise but still well down on the 91 houses sold in March 2013 - a massive 46.2 per cent drop in 12 months.

Median prices also improved in the Eastern Bay of Plenty rural area, rising to $274,000 in March, up from $259,000 in February - a 5.6 per cent increase.

However sales dropped from 42 in February to 34 in March - down 19 per cent. Forty-nine houses in the rural Eastern Bay were sold in March 2013.

REINZ regional director Philip Searle said LVR (loan-to-value ratio) restrictions were having an effect, with the number of first-home buyers lower than in March 2013.