Median house values up 56 percent over the past year in Tararua.
Pic: BTG251021HOUSING Caption: Median house values up 56 per cent over the past year in Tararua.
By John Arends,
Property Brokers Pahiatua.
Tararua residential property values have reached an all-time high, with median house values reported by REINZ sitting at $500,000, up 56 per cent over the past year.
This median value has skyrocketed over the past six months with the median for the previous six months being $435,000, and only $320,000 a year before
Number of sales for residential houses on under 2000sq m hasn't moved much, with the year-to-date numbers sitting at 329, compared to 338 for the same period the year before.
Residential sections (under 2000sq m) have also shown strong activity, with 51 sections selling for the year ended September 2021 achieving a median value of $150,000, the previous year more sections were sold (62) however the median price was virtually half, being $79,000.
Interestingly, the same period in 2015/16, only 26 sections sold for a median price of $35,000, and 10 years ago 14 sections sold across the entire Tararua District for a median price of $45,000.
Along with strong demand and prices for residential sections, lifestyle sections are selling well, with approximately 40 sold over the past nine months, with new developments accounting for a large number of these.
These figures are exceeding the national trend, with the median house price across NZ in September sitting at $795,000, up 15.4 per cent from $689,000 in September 2020.
Over the past year nationally, the number of properties on the market has decreased to 5385, the lowest for 10 years and is probably a response to the Covid lockdowns in the Auckland, Northland and Waikato regions, which account for about 40 per cent of private dwellings in New Zealand.
Other factors, I assume, that account for the lower number of properties on the market, are the negative impact of shortage of builders, increased building costs and compliance around subdivision, creating a bottleneck for potential vendors.
They are hanging on longer in their existing properties because they have virtually nowhere to go despite wanting to upgrade, downsize or move to the lifestyle block.
This resulting shortage has created the perfect scenario for an exiting vendor, with the increased competition for buyers in a tight market often creating premiums in excess of vendors' (and agents') expectations.
■ Where to from here?
I expect that with our ongoing shortage of property on the market, relatively low interest rates, low unemployment, and strong support for the residential sector from the trading banks, values will hold but the increase in values will flatten off, the affordability and bank security concerns will dampen the rampant increase in values.
In reality, who knows, nobody predicted this current scenario, and with nearly two million locked-up Aucklanders being set free in the next month or so, could see an increase in demand to live in the provinces.
The investment means Napier Port will co-own a dredging ship.