Sunny days suit property market in Gisborne

The region’s house prices have bounced back with the nation’s biggest increase, arresting a six month-long slump.

Latest statistics from the Real Estate Institute (REINZ) shows the median price here increased by 14.8 percent year-on-year to $650,000, making it one of just three regions to experience a rise (alongside Southland, up 2 percent, and Northland, up 3.6 percent).

“Owner-occupiers and first-home buyers were the most active buyer groups in the region,” REINZ chief executive Jen Baird said.

“Most vendors are meeting the market, yet some were still holding on for more favourable conditions. Open homes continued to see an increase in attendance; there was strong activity and active bidding at auctions.

“The current economic conditions, low listing numbers, and anticipation of the election continued to impact market sentiment amongst both buyers and sellers. However local agents report that buyer activity has become more buoyant.”

Last month’s $85,000 year-on-year rise follows sixth successive months of price decreases.

REINZ Gisborne ambassador Mark Nicol, from Property Brokers, said that was down to some “significant shifts” in property transactions.

“Notably, higher-value properties have dominated the market scene,” Mr Nicol said.

“This phenomenon can be attributed to several factors, including a temporary pause among first-time home-buyers due to rising interest rates and a perception of a declining market. Many prospective buyers chose to wait and gauge the market’s direction before making a move.

“Additionally, investors have recently begun divesting themselves of lower-value properties. This divestment is anticipated to have a cascading impact on the median property value.

“Despite these fluctuations, the real estate market continues to demonstrate robust activity. Multiple offers are frequently being presented for properties, indicating a competitive environment.”

Mr Nicol said current stock levels appeared to be artificially low.

“The situation can be attributed, in part, to the aftermath of the major upheaval caused by Cyclone Gabrielle and subsequent weather events. These prompted individuals to adopt a conservative approach, leading to a ‘batten down the hatches’ mentality and a focus on protecting existing assets. Again we are seeing signs of this easing with much more inquiry from people looking at putting their property on the market.”

Bayley’s Gisborne director Simon Bousfield said it was a bit early to say if the market was back to the consistency of price levels experienced 18 months ago, but it was an encouraging sign that Gisborne has taken the country’s top spot for median price rise.

“Our days to sell, while still high compared to historically, is coming back from previous months, which is a clear reflection of the buyer activity we are seeing both at our open homes, in our auction room, and involvement in deadline sales.

“Sales have increased dramatically from last month. However, this figure would likely be much greater with more property available. Stock levels are still notably low.

“The election is having an effect on properties being listed, with most people inclined to wait for this result to be confirmed. Our take on this is that there may be a bottleneck of activity post-election, and with buyers out in force and prices rising, now would appear one of the better times to sell that we have seen in a number of months.

“Finally, the run of good weather has also increased activity. Quite simply, more people are inclined to make decisions and progress with property plans when the sun is out.”

Nationally, the median price was $767,000, down 4.1 percent on the same time last year.