Property values in every suburb in Tauranga have dropped. Photo / Mead Norton
Property values in every suburb in Tauranga have dropped. Photo / Mead Norton
An average drop in Tauranga house values of $69,000 in three months could spell good news for first-home buyers as investors run cold and vendors ''sit on their hands''.
Every suburb dropped and Judea and Greerton now made up five suburbs in the city with properties valued under $800,000.
Realestate agents NZME spoke to say there has been increased attendance at open homes as vendors look to list and get their properties sold and completed by Christmas.
The OneRoof-Valocity House Value Index shows the city had the biggest value drops in the Bay of Plenty and a suburb-by-suburb breakdown reveals some of the houses at the lower end of the market were hardest hit.
Poike - also known as Windermere - fell from $795,000 to $723,000, Parkvale $768,000 - $709,000, Judea $857,000 - $797,000, Greerton $842,000 - $788,000 and Gate Pa $768,000 to $731,000.
Now 10 out of 20 suburbs are valued at under $1 million while in the over $1 million market Bethlehem has the largest value slide, from $1.3m to $1.24 m.
However, the Bay of Plenty was still ranked second behind Auckland with the average property value at $1m compared to $741,000 two years ago. The average house value in Tauranga was $1.1m.
''There's usually a lag between what we see in headlines to what vendors actually expect when they go to market. There is a realisation that 20/21 prices are not achievable,'' he said.
''The sense of price decline - while it's probably not over it's starting to reach the bottom point.''
There was a greater pool of properties for first home buyers and they had the power of leverage, he said.
''First home buyers may be able to find something now that ticks all their boxes.''
Managing director of the Realty Group Ltd, which operates Eves and Bayleys, Heath Young. Photo / Supplied
Heath Young, managing director of Realty Group Ltd, which operates Eves and Bayleys, said there was a definite pick-up in buyer activity and a good supply of houses.
''We are seeing increased attendance at open homes with more multi-offer and pre-auction activity starting to come back into the market.
''There's also the typical spring lift in listing activity and volume as vendors look to list and get their properties sold and their next moves completed by Christmas.''
Young said earlier this year many people had been delaying making decisions relating to property and that could add to activity through to December.
''The period between now and Christmas is where buyers and vendors want to get things done.''
Harcourts Tauranga managing director Nigel Martin. Photo / Supplied
Harcourts Tauranga managing director Nigel Martin said the property market was currently performing below what it had been used to over recent years.
''We are still selling property across all the buyer types, but at lower volumes than we would normally expect.''
However, it was starting to see more people attending open homes and there was generally always a lift in sales activity in the spring months, he said.
''There are signs that is beginning to happen.''
Stock was at pre-pandemic levels but ''there are a lot of buyers out there sitting on their hands in a wait and see situation''.
''While this is the case it is providing a good selection of property for those buyers who are ready and able to purchase today.''
Waikato and Bay of Plenty Property Brokers regional manager Simon Short said any changing market presented opportunities.
''That is the upside of a changing market where inherently more expensive properties have now reduced in value to a point which is probably going to entice more activity.
''There are more buyers and multi offers now coming forward on good quality stock and that is a good sign.''
Waikato and Bay of Plenty Property Brokers regional manager Simon Short. Photo / Supplied
Short said, in his view, buyers had identified the fact there was no way to read whether the market was at the bottom or at the top.
''But they know the sellers that are in the market now are serious. They are aware of the landscape around the price adjustments or plateauing prices and I think that is important.''
However, Short said house prices were still ahead on value to the same time last year.
Valocity head of valuations James Wilson said challenging conditions, including the Official Cash Rate and rising interest rates, meant there were fewer investors.
''They have kind of pressed 'paused' and aren't as active as previous years.''
The mover group who sold one home to buy another had also become cautious while first-home buyers were able to capitalise in some circumstances.
''That hasn't been in a major way ... but we saw it rebound for a couple of months. I think it is safe to say some of the first home buyers that were in a position to buy have been able to make that purchase with perhaps a bit less competition than there would have been 12 months ago.''
Wilson said it also expected another surge in activity.
''There will be a return to the more seasonal variation that we used to get between winter and spring. It feels very new and very different but New Zealand used to have this before the market went hot.''
