Steve Hart: It's a one-way ticket out

Photo / Doug Sherring

The word is that because there is so little to choose from when it comes to finding a property, the mindset among many wannabe movers seems to be “there’s no point selling because there’s nothing to buy”.

It looks like we may just about be facing a chicken and egg situation when it comes to real estate in Auckland as all but the determined appear to be holding back when it comes to putting their property on the market.

The word is that because there is so little to choose from when it comes to finding a property, the mindset among many wannabe movers seems to be "there's no point selling because there's nothing to buy".

From what I can see, most of the properties being marketed are owned by people who are really motivated to move to a new location, are having to trade up because of their growing family or are facing empty nest syndrome and simply can't stomach rattling around a large house any longer.

Perhaps others are sitting tight, waiting to sell their property at the peak price before the market hits a flat spot (I don't see the Auckland property market levelling out any time soon).

Meanwhile, many parts of the country are only just above 2007 property price levels, so for those who want to move out of Auckland, you can get a lot for your money. However, with the exception of the well-resourced, it could be a one-way ticket, as getting back into Auckland may prove troublesome for some a few years down the track (if the price disparity continues).

First-home buyers

Life is also getting tougher for people looking to buy their first home in Auckland. Jonno Ingerson, director of research at CoreLogic, says that when it comes to properties at the $400,000 mark, the pickings are pretty slim.

Drawing on data from the firm's E-Valuer software -- which estimates the market value of every property -- he says there are no properties on the Shore at that price.

"If your budget stretches to $550k then there are more options on the North Shore and the fringes of Auckland City," he says.

Those dreaming of owning the Kiwi quarter acre (1012sq m) paradise may also be out of luck.

Jonno says of Auckland properties worth $600,000 only 4 per cent have that much land, and they are mainly in the West and South of the city.

However, the capital is looking like a good bet. Jonno says that since the LVR speed limits came into effect in October 2013 first-home buyer activity has shifted to cheaper areas.

"One good example of this is Trentham, a suburb in Upper Hutt, north of Wellington, where more first-home buyers have been purchasing," he says.

The average value there is $303,000 and while there are only a handful of quarter acre properties, 25 per cent of them are more than 800sq m.