Buyers outstrip homes

We are living in "unprecedented times" says Nick Goodall of property information firm CoreLogic, with the latest QV House Price Index showing Auckland real estate having risen in value by an average of 24.4 per cent in the last 12 months.

Writing on the company's website, he says that while there may not be too many buyers in the market willing to pay well over the odds, there are still plenty of people looking for a home.

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He says the pipeline of buyers won't clear any time soon, particularly as nowhere near enough new homes are being built in the Super City. And for those looking to get a bargain outside Auckland, time might be running out.

He says: "No doubt there are some attractive returns for investors, but that won't continue as prices increase in the regions and investors become more cautious with their offers."

However, he says net migration and low [housing] supply aren't as significant outside Auckland, "so it's unlikely the impressive growth we're seeing in places like Hamilton will be sustained".

Cooling off

Figures from real estate firm Barfoot and Thompson show that property sales in October were 14 per cent up on the same month last year.

But BNZ economist Tony Alexander says caution is needed with annual comparisons because last year activity cooled off in the run-up to the September 20 general election.

He says in seasonally adjusted terms, sales fell 20 per cent in October "so there may have been some buying ahead of rule changes from October 1".

Alexander says it will take a few months before we start to see how the various government and Reserve Bank rule changes have impacted Auckland real estate.

"It would be surprising not to have things generally quietening down given the measures introduced specifically to achieve that," he says.

Buyer beware

The Real Estate Agents Authority (REAA) says one of the more serious issues it deals with is when a buyer discovers they have to pay 15 per cent GST on top of the agreed purchase price for a home.

It's rare that a property is marketed without this being made clear, but it is always worth checking, particularly when buying property that may have been used for business.

The REAA also says regional councils are lending money to homeowners to upgrade their property and adding loan repayments to their rates bill. Check to make sure you don't pay for a loan taken out by the previous owner.

Always seek independent professional advice before signing any contract.