Small towns next ‘hot spots’
O¯ taki and Featherston will be the Wellington region’s next ‘‘hot spots’’ for first-home buyers and property investors alike, property valuer Quotable Value predicts.
QV area manager Paul McCorry said those buyers had already been priced out of Wellington City, ‘‘either by the high access costs or because of the very low yield relative to the investment cost to an investor’’.
‘‘Until now, this has made the Hutt Valley a hot spot for young families and speculators alike. But where once you could get a home on a half-acre section for under the national average, now sales prices are often well over $1 million.’’
Lower Hutt’s median price went from $565,000 in October 2019 to $761,000 in the same month this year, according to Real Estate Institute figures. That’s a 35 per cent jump.
McCorry described a recent example where a Lower Hutt home was sold in a day by negotiation for $1.3m. ‘‘It does make me wonder if the Hutt Valley has run its course as a more affordable property market.’’
Upper Hutt over the same period experienced a jump of 14 per cent to take it to a $655,000 median price.
McCorry said the areas that traditionally had the most affordable housing were now experiencing the greatest increases – ‘‘places like O¯ taki and Featherston’’.
‘‘The way New Zealand’s overheated property market is tracking right now, neither Featherston nor O¯ taki may stay affordable for long.’’
He said both towns only had three properties listed for rent when he checked, which almost guaranteed property investors that they would have no problem finding tenants.
Ka¯ piti Coast Mayor K Gurunathan said the wave of increasing property values had already started to create an identity crisis in his hometown of O¯ taki.
Gurunathan said it was a highdeprivation area with a lot of people who could not afford high rents, and many people were being forced out.
‘‘What we are looking at is sometimes called the gentrification of O¯ taki, and with that comes some positives in the sense you’ve got
diversity coming in. But by the same token ... people are pushed out taki further north.’’
This would change the makeup of a town where many residents had lived for generations.
‘‘There’s a looming crisis with our local identity and locals are recognising this.’’
Gurunathan said a side effect of this that was the local college was considering bussing in students because families were leaving.
South Wairarapa Mayor Alex Beijen said while in the past few years Featherston had been popular for first-home buyers because of its affordability and proximity to Wellington, that was rapidly changing.
‘‘Unfortunately you’re even seeing Featherston pushed out of the first-home buyers’ market,’’ Beijen said.
‘‘I bought two houses in Featherston 15 years ago for $66,000 each and I wish I’d kept them because it wasn’t that long ago.’’