The median house price in Rotorua continues to rise.
The median house price in Rotorua continues to rise.
The gap between buying or building a house in Rotorua appears to be closing, with more inquiries "than ever before" about building in the city.
Local real estate agents have weighed in on what the better option is in Rotorua's current property market as the median house price continues to rise and stock levels remain at all-time lows.
Real Estate Institute of New Zealand's (Reinz) figures for June show the median price in the Rotorua district was $440,000, up 23.9 per cent compared to June 2017.
The number of houses sold in June was 96, down on the 124 sold the month before.
LJ Hooker principal Malcolm Forsyth said the trend was "steady as we go".
"It's an interesting market at the moment. We're seeing some stability out there but I'd like to see more properties on the market."
Forsyth said whether buyers bought an existing home or built new was a matter of preference and new builds were popular but more expensive.
A total of 96 houses were sold in the Rotorua District in June. Photo/File
"There's always been a bit of a gap between building and buying but we have been selling at Arohanui Parade on Vaughan Rd. There were 36 sites out there, now we only have two left so there are people out there wanting to build," he said.
"Traditionally when we get into the warmer months, more property comes on the market and there's nothing to suggest that won't happen again."
Professionals McDowell Real Estate co-owner Steve Lovegrove said in previous markets people buying new builds may have worried that by the time the house was built, its value wouldn't match the market.
"In the past, people would fear the market would go down and they would have overspent."
But now that's not a concern, he said, as house prices continued to rise.
"Before you see these [Reinz] statistics we see the offers people make on these houses. People are out there offering mad amounts of money," he said.
The median house price in Rotorua continues to rise.
Lovegrove said his agents were still seeing a lot of visitors to open homes and when people saw competing buyers, they took action.
He agreed the low number of houses on the market was partly seasonal but said it was lower than usual.
Mortgage Centre owner Graeme Leigh said he had received more phone calls from clients looking to buy sections and build than ever before.
"This is the highest level of inquiries from people wanting to buy [sections] and build in my 20 years as a broker.
"We're definitely seeing more interest in that area."
Leigh said he thought this could be a result of limited stock on the market.
"We've had clients pre-approved to purchase who have been looking for some time, when they find a house they're very often in a multiple offer situation, or they've been unable to find a property that is suitable."
Leigh said one benefit to building was the Government's Home Start Grant.
Individuals can receive up to $5000 if buying an existing home, but up to $10,000 if buying a new build.
He said there hadn't been a pattern to the people looking to buy sections. The inquiries came from all age groups and stages of life.
Lockwood Homes managing director Andrew La Grouw said the company was seeing a few more requests for new builds, but that still equated to small numbers.
"There is a bit of demand here. The problem is there's a lot of people interested but the land is quite expensive and there's not a lot available."
La Grouw said building new was more expensive than buying an existing home but it would be in better condition.
"A modern house is well-built with double glazing, insulation, it's got more power points, better appliances. That's why, over time, the value of a new build is better."
He said it was difficult to put a cost on a new build as it depended on the site the house would be going on and how much work needed to be done there.
OneRoof editor Owen Vaughan said the rise in median price during the winter months indicated strong buyer interest.
"Rotorua's housing market has grown in value and the latest figures will comfort those who have secured a foot on the property ladder and should signal to buyers that the market will continue to offer positive gains."
He said buying an existing home or new build came down to personal choice.
"Both options in the current market would yield gains for buyers."
Reinz regional director Philip Searle said the majority of the Bay's growth in June had come from Rotorua and Whakatāne as they were the only areas to see increases in both median price and sales volume.
"Inventory levels continue to fall in the Bay of Plenty region which makes any new stock a very popular commodity," he said.
"Despite the low listing numbers, the region is still active, and we continue to have plenty of multi-offers. However, with low inventory levels, it does affect the overall sales volumes."
First National principal and Rotorua Real Estate Institute of New Zealand ambassador Ann Crossley said the median number of days to sell was sitting at 31, compared to 39 in May and 34 in June last year.
"The interesting thing is the majority of sales were in that $400,000 to $450,000 range."
When it came to building or buying, Crossley said the major difference was you could build exactly what you wanted.
"You've also got the efficiency factor, double glazing and a more energy efficient home."
