First-home action hot

HEAT: The Bay's spring property surge continues with activity across most price brackets. PHOTO FILE

An accelerating Hawke's Bay real-estate market has seen first-home buyers increasingly active but industry professionals say there is no need to panic.

"The increase in the KiwiSaver pay-out price cap for Hawke's Bay properties from $300,000 to $350,000 has boosted activity from first-home buyers, giving them a helping hand with their deposits to enter the market," QV valuer Bevan Pickett said.

"There is definite optimism in the market and there has been activity across most price brackets, with upward movement in values apparent."

Cole Murray mortgage broker Steve Davies said since the cap was lifted in April he had seen a lot more first-home buyers seizing the combined opportunity of low interest rates, the Welcome Home loan and FirstHome grant.

"We have had a number of people buy throughout the winter who are very happy with their purchase for $250,000 to $300,000," he said. "For under $350,000 you can get quite a nice home."

He said despite increased activity in the market there were still good opportunities. The volume of listings was below average and some people holding on for higher prices "but we are heading into spring when a lot more listings come on to the market".

"We would expect there to be a lot more opportunity."

A house should never be bought in a hurry and if buyers missed out they should keep looking.

While low interest rates were welcome, they were no guarantee of a larger mortgage. Banks kept a margin on servicing criteria "to ensure people don't go in with low rates and get hit really hard should they [interest rates] go up".

Harcourts Hawke's Bay managing director Kaine Wilson said spring stock suitable for first-home buyers was arriving but business was brisk across the board.

"In our auction room yesterday just over 70 per cent of what we put up was sold either on the day or the day following," he said. "That is a definite increase, with multiple bidding."

Mr Pickett said the market was "eager" but quality listings were lacking. Out-of-town buyers were active, increasing competition.

Sales results were mixed, some properties selling at expected prices but similar properties, some on the market for a year, had received multiple offers and sold for 10-20 per cent more than expected.

REINZ August figures showed the volume of house sales for Napier was up 75 per cent on August 2014 and Hastings up 23 per cent, yet the median changed little due to few high-priced sales.

The QV House Price Index for September, a three-month average, showed Napier city home values increased by 1 per cent over the three months and a 1.3 per cent year-on-year rise.

Hastings values rose 0.7 per cent over the three months to be up 5.5 per cent year-on-year.

REINZ figures for the month of September are expected to show continued activity but agents have reported a jump in higher-priced sales, which would lift the median price.

"House prices have definitely lifted, as opposed to this time last year," Mr Wilson said.