Beach suburb leads way as house prices surge

COMMUNITY SPIRIT: The Castlecliff Rejuvenation Project is making the beachside suburb a more popular location.

Whanganui house prices are surging - and it's unfashionable Castlecliff that is leading the growth across the district.

The beachside suburb, once regarded as the roughest part of town, is being seen in a new and positive light by house buyers.

CoreLogic house price data released this week shows Castlecliff house prices rose 14.8 per cent in the 12 months to June, jumping from a median price of $109,100 to $125,200 - that's the largest percentage growth across Whanganui and Taranaki.

Some are putting the change in fortune down to the rejuvenation project that the Castlecliff community has kick-started.

Annual growth district-wide was 10.3 per cent year on year, with the median house price pushed over $200,000.

Tim Hocquard of Ray White real estate wasn't at all surprised Castlecliff's value was growing after a surge in interest in the area.

"A couple of years ago you couldn't give houses away there - now we are seeing people falling over to get there," he said.

The suburb has long been the cheapest location in Whanganui, but Mr Hocquard said a growing sense of community was one of the reasons behind the growth.

Houses there were still relatively cheap and that, coupled with sea views, were also attracting buyers.

Prices had also been driven up by a decrease in the number of properties available.

"People aren't moving away, so there are fewer houses out there compared to a few years ago."

He said one Castlecliff property on the market had 10 potential buyers through without even being advertised.

Property Brokers' Philip Kubiak said the Whanganui market showed no signs of slowing down, with August likely to be one of the strongest sales months in recent years.

"The last few months have been terrific for Whanganui," he said.

And he added that it was only a matter of time before undervalued suburbs like Castlecliff were more in demand.

Most buyers had been locals, although there have been some investors buying after being forced out of higher value markets such as Wellington and Auckland.

"There has been an even spread of first home buyers and investors, which have been a mix of locals and out-of-towners."

Forty properties were sold in Castlecliff in the three months to May, the most in any other three-month period listed since 2013.

Mr Hocquard said efforts from the Castlecliff Rejuvenation Project members to reinvigorate the suburb were paying off. "These guys live out there, they swear by it and they're proud of where they live. It's good to see something this positive in Whanganui."

Gonville had the next largest annual house price increase of 12.8 per cent, with a median house value of $147,400.

Overall, Whanganui district had annual growth of 10.3 per cent to a median house
price of $200,022 between June 2015 and June 2016, according to Corelogic.

After Castlecliff and Gonville, the next biggest percentage increases were
in Whanganui (median house price $150,950) at 10.3 per cent; Whanganui
East ($170,800) at 10.2 per cent; Springvale ($247,300) at 9.5 per cent;
Tawhero ($212,700) at 8.8 per cent; St John's Hill ($295,150) at 7.9 per cent);
and Aramaho ($159,650) at 7.5 per cent.