Prices drop as it gets colder

South Waikato News - - NEWS -

House prices are head­ing south in some parts of the Waikato as lend­ing re­stric­tions start to bite.

The South Waikato district hous­ing mar­ket has seen its big­gest drop in house prices since the start of the year.

Quotable Value Ltd ( QV) fig­ures for June show that prices have dropped 4.4 per cent in the past three months, and are 1.6 per cent lower than they were at the same time last year.

But Har­veys Toko­roa sales­man Ben John­son said those num­bers are noth­ing to fret about.

‘‘If it was 4.4 per cent on the Auck­land mar­ket it would be a dif­fer­ent story. With the prices here I wouldn’t call 4.4 per cent a slump I would just call it nor­mal re­ally.’’

He said tra­di­tion­ally prices drop when the tem­per­a­ture does.

‘‘ Tra­di­tion­ally the win­ter months aren’t as busy as say spring and sum­mer.’’

They have dropped a whop­ping 23.2 per cent since the hous­ing mar­ket peaked in 2007.

John­son said it is hard to com­pare the two time pe­ri­ods.

‘‘ I think that was a higly in­flated mar­ket and you know it’s kind of come back down from there.’’

QV Val­uer Nicky Har­ris said the num­ber of houses swap­ping hands had pulled back thanks to the loan-to-value ra­tios (LVRs) in­tro­duced by the Re­serve Bank in Oc­to­ber last year. The re­stric­tions re­quire a de­posit of at least 20 per cent be­fore banks can ap­prove lend­ing.

‘‘In many parts of the wider Waikato re­gion many smaller towns are see­ing de­creases in value hav­ing been hit hard by the LVR (loan-to-value ra­tios) speed lim­its which have slowed ac­tiv­ity and are driv­ing val­ues down,’’ Har­ris said.

John­son said most South Waikato buy­ers are meet­ing the mar­ket with prices.

‘‘I guess the thing about it is they know the mar­ket pretty well as well.’’

Stephen Ea­gle was one ven­dor forced to lower his ex­pec­ta­tions.

Ea­gle said it took two years to sell his two sto­ried, four bed­roomed home.

It was on the mar­ket for $180,000 and af­ter a price drop in June he sold it for $158,000.

‘‘ Ben [ John­son] tried ev­ery­thing,’’ he said.

But the low prices worked both ways for the res­i­dent who ar­rived in Toko­roa in 1969.

He is mov­ing into a town house which he snatched up in a mort­gagee sale for $44,000 – close to half the price it was listed for.

He said what goes around comes around, people just need to ‘‘hang in there’’ and some­thing will crop up.

‘‘ There’s some bloody nice houses for sale at the mo­ment.’’

Fine work: Olivia MacPher­son,12, took out the ju­nior sec­tion of the GoBake cake dec­o­rat­ing com­pe­ti­tion with her pic­nic de­sign.

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