Sellers seek top dollar
A coronavirus-induced tumble in house prices isn’t a given, Waikato’s real estate bosses say.
New figures from realestate. co.nz show the average asking price in Waikato has hit an alltime high of $680,961 – an 8.7 per cent year-on-year increase.
The new high comes as the number of houses for sale across the region drops to 1570, a decline of 21.6 per cent when compared to May 2019.
Only 613 houses were listed for sale in May, a decrease of 18.4 per cent when compared to the same period last year.
Disruption and uncertainty caused by Covid-19 has led some economists to predict a fall in house prices. Economic consultancy Infometrics has forecast house prices to tumble 11 per cent by the end of 2021.
Lugtons managing director Simon Lugton expects the Waikato housing market to cool at some point but said there are no signs of that happening yet.
The level of interest from buyers is similar to what was seen pre-Covid-19.
‘‘The appetite from buyers is certainly there, in terms of offers and attendance at open homes,’’ Lugton said.
‘‘Tight supply and the demand has held up for now which leads to competition, and competition is never going to let prices slide.’’
Research by the Real Estate Institute of New Zealand (REINZ) and realestate.co.nz show a strong relationship between asking prices and sales prices.
Lodge Real Estate managing director Jeremy O’Rourke isn’t surprised the average asking price in Waikato has hit an alltime high given the country was in the middle of a housing crisis when everyone went into Covid19 lockdown.
Every day, O’Rourke is seeing competing purchase offers for houses, putting upward pressure on prices. It isn’t a given that house prices will drop in Waikato in the wake of the Covid-19 crisis.
‘‘I don’t think it’s a guarantee and it’s hard to understand how they are going to drop,’’ O’Rourke said.
‘‘You’ve still got some really good projects occurring in the region, people are keen to get into housing, and there doesn’t seem to be enough property on the market.’’
Harcourts Hamilton general manager Brian King said agents are reporting good interest from buyers.
Along with historically low interest rates, a lot of New Zealanders had returned to the country due to the Covid-19 crisis. This has led to new buyers seeking to enter the property market.
‘‘A lot of expats have no job prospects where they’ve come from, so they’ll be looking to establish themselves,’’ King said.
‘‘The market isn’t like it would be if Covid-19 never came but it’s certainly a lot better than I thought it would be, a heap better.’’