Katikati median house Prices hit 5-year high
Rural town’s market takes off as buyers look for cheaper alternatives to Tauranga
As Tauranga’s house prices reach a record median of $905,000, prices in a neighbouring suburb have also climbed to the highest they’ve been in five years as buyers seek affordability outside the city post the Covid-19 lockdown.
Median house prices in Katikati have reached $624,000 and real estate agents say the area is punching above its weight in the property market, with prices increasing rapidly in the past six months. They say retirees and young families are eyeing up
Katikati as a more affordable option.
Housing supply was tight with sales volumes rising only slightly in the past few years. However, agents say a new luxury townhouse development could help ease the pressure.
Latest Real Estate Institute (REINZ) data shows median prices in Katikati climbed to $624,000 in the year to February – $137,000 more than the $487,000 median in February 2017.
In the past year, prices have skyrocketed 15.6 per cent from $540,000 last February – the largest jump in the past five years.
However, sales volumes climbed only slightly each year to 152 in February 2021 from 136 in February 2017.
REINZ acting chief executive Wendy Alexander said house prices in Katikati had increased rapidly during the past couple of years.
“Unsurprisingly, vendor expectations have been rising as prices in the wider area have risen, so it’s just a matter of making sure that this is managed accordingly, although some of the prices achieved post-covid continue to surprise local agents.”
Interest in Katikati was coming from all parts of the country, particularly from retirees, who liked the easy access to the medical centre and nearby Tauranga Hospital.
“Families in the wider Tauranga area have been looking further afield as prices have continued to increase in the city, and Katikati is seen as a more affordable area that’s within a reasonable commute to Tauranga.”
Some buyers were reporting “auction fatigue” as prices continued to climb, making it harder to gauge what a property might sell for, especially in the case of first home buyers, Alexander said.
Supply was still tight, “but it’s slightly better than we saw at the beginning of the year where properties were quite tightly held”.
“Hopefully in the next few months,
The volume of sales haven’t increased as much but the prices certainly have. David Sylvester, Eves Katikati
we’ll see more supply come on to the market which will in turn hopefully ease some of the demand and pressure we’ve seen on prices.”
The Uretara River Views development on Katikati’s main street overlooking the Kaimai Range recently launched 29 luxury townhouses on to the market. Another 35 townhouses were due to come to market shortly.
Alexander said the development would add to the overall supply once it was ready.
Simon Anderson, managing director of the Realty Group Ltd, which operates Eves and Bayleys, said Katikati was “punching above its weight for market presence”.
“We’re finding a lot of people are comfortable with Katikati as it is in close proximity to Auckland, has a good price point, and it’s a nice town with all the services.
“It’s not a hustle-and-bustle town. It’s still a New Zealand town.
“You’ve got all those nice ingredients. So it’s not surprising it’s finding its feet more in the market.”
Anderson said there was also a lot more buyer interest in Katikati properties in the auction rooms, with the area becoming attractive to Auckland and Tauranga buyers.
Eves Katikati branch manager David Sylvester said there had been a sharp increase in prices, especially in the past six months.
“The volume of sales haven’t increased as much but the prices certainly have.
“Things are selling a lot quicker, too. Most of our sales go through auction and they’re selling before or on auction day, which is a massive difference from 12 or 18 months ago.
“We’ve had a lot more investor interest in the last six months but we’re getting people moving out of the major cities like Hamilton and Auckland as well as people moving out from Tauranga.”
Sylvester said many people moved to Katikati for lifestyle properties.
“There are a lot of people who have bought small horticulture blocks where they can have a bit of a home and income.”
Alison Rudd, Waih¯ı and Waihi Beach sales consultant for Tall Poppy Real Estate Katikati, said Katikati was a sought-after area and prices had been growing rapidly.
“Properties we appraised at the end of last year are well out of date now. Everything is just jumping up in price.”
Rudd said house prices were “flying through the roof”.
“We always thought they were at a high price prior and now they’re extraordinarily high, which is great for vendors.
“Obviously people are seeing the benefit of moving to the Bay and see Katikati as a desirable area.”
Buyers were coming from all sectors and price ranges, she said.
“We listed a property a couple of weeks ago and it went to multi-offer and it sold within three days at an extremely high price.
“That was probably the highest price you’ve got in Katikati town and it sold within just a few days in the market.
“We’re finding we’re getting some really good results without taking properties to auction.”