Rotorua's average property value has climbed in the past three months by 4.4 per cent - or $33,000 - to $782,000. Photo / Andrew Warner
Rotorua's average property value has climbed in the past three months by 4.4 per cent - or $33,000 - to $782,000. Photo / Andrew Warner
Rotorua's average property value has climbed $33,000 in the past three months in a "stunning turnaround".
A new suburb-by-suburb breakdown also shows Rotorua continuing to move against the tide of a regionwide property slowdown, with only two suburbs showing a drop in value.
The latest figures from the OneRoof-Valocity HouseValue Index show Rotorua's average property value was up 4.4 per cent - or $33,000 - to $782,000.
More than a third of Rotorua's suburbs enjoyed value growth above the city-wide average, with Lynmore up 9 per cent - or $82,000 - to $992,000, and Matipo Heights up 8.4 per cent - or $86,000 - to $1.109m.
Mangakakahi and Utuhina were the only two suburbs to show a drop, with Mangakakahi down 0.7 per cent - or $4000 - to $560,000 and Utuhina down 1.1 per cent - or $7000 - to $638,000.
OneRoof editor Owen Vaughan. Photo / NZME
OneRoof editor Owen Vaughan said Rotorua was bouncing back from its "slump" and had a "stunning turnaround" after months of little to no growth.
Meanwhile, house price growth in the Bay of Plenty slowed to 2.2 per cent over the quarter.
Ōpōtiki was bearing the brunt of the market slowdown in the region, with the average property value falling 2.2 per cent - or $14,000 - to $623,000.
Tauranga was also feeling downwards pressure, with the city's average property value growing just 0.6 per cent to $1.243m, and four of its suburbs seeing value declines.
RDP_avg_property_values_OLv2
Rotorua Professionals McDowell Real Estate principal and auctioneer Steve Lovegrove said Rotorua's top-performing suburbs had higher-value properties.
He said that was because people who already had capital base in their properties were able to borrow money and make a move.
"Over the last three months, we have seen strong interest in properties in lifestyle. We have seen some pretty spectacular results at the high level of the market."
Rotorua Professionals McDowell Real Estate principal Steve Lovegrove. Photo / Andrew Warner
Lovegrove said the first-home buyer and investor market had been much more subdued.
"However, Rotorua always stands as the best buying in the region for people who are looking to get into the market."
Ray White Rotorua business owner and principal Jacqueline O'Sullivan said it was encouraging to see the city's property values were performing well.
"Rotorua is still a destination and lifestyle choice. With many people now having the option to work from home the regions are enjoying growth with people relocating to have a better work and life mixture."
But O'Sullivan said new lending restrictions brought in last December had put a damper on properties between $500,000 and $750,000 that appealed to first-home buyers and investors.
Ray White Rotorua business owner and principal Jacqueline O'Sullivan. Photo / Supplied
O'Sullivan said people looking at lifestyle, rural and lakeside properties generally had the money to purchase and do not rely on finance.
Lakeside properties, specifically in Lake Rotoiti and Lake Tarawera, had seen some "amazing prices" and lifestyle properties were also selling well, she said.
"After the first lockdown, I think people that were confined to small spaces would have much preferred to be on a bit of land."
O'Sullivan said while Rotorua had always been slow in following other market trends it had caught up "in speed" with price increases since the Covid-19 lockdown in March 2020.
"I am just glad to see that we are in no mad rush to slow down too quick."
First National principal and Rotorua REINZ spokeswoman Ann Crossley. Photo / Andrew Warner
First National principal and Rotorua REINZ spokeswoman Ann Crossley said Tauranga had really felt the brakes go on but Rotorua had not.
"Buyers are definitely waiting for prices to drop but it is about educating buyers that that isn't going to be substantial in Rotorua.
"It is now about getting vendor expectations to line up with buyers."
Crossley said historically when the country "booms" Rotorua did too but on a slower trajectory.
"Because we didn't boom as big, we don't bust as big but we will see a slowing down, and an increase in the number of days to sell."
Harcourts Rotorua sales manager Michelle Matthews said the lower end of the market dominated by first-home buyers and investors had been significantly affected.
"The Rotorua market traditionally is not affected by the massive highs and lows seen in other cities. Rotorua is normally what I would call a 'Steady Eddy' market."
Nationwide, 17 of the country's 71 territorial authorities registered zero or negative growth over the quarter.
Lower Hutt suffered the steepest drop at 2.9 per cent, Auckland was next at 2 per cent, followed by Hamilton at 0.5 per cent, Tauranga at 0.6 per cent and Dunedin at 0 per cent.
Wayne Shum, head of research at Valocity. Photo / Supplied
Wayne Shum, head of research at Valocity, said the steady rise in mortgage rates had dampened market activity and put downwards pressure on the volume of mortgage registrations.
However, he said the Credit Contracts and Consumer Finance Act probably had the biggest effect on buyer appetite.
"For many, getting a mortgage has proved too hard, and delayed or torpedoed purchase plans.
"The U-turn on some of the CCCFA's more stringent measures will come into effect in June, so there may be a brake on further falls."
