South a top spot for home sales

First-home buy­ers and cheaper mort­gages help push up prices in South Auck­land

Herald on Sunday - - IN OTHER NEWS - Ben Leahy

South Auck­land has emerged as the city’s hot spot for home sell­ers post Covid-19, while buy­ers would do bet­ter to look for bar­gains in the city centre, Hen­der­son and Re­muera.

That’s according to an ex­clu­sive new house price in­dex by an­a­lysts OneRoof and Valoc­ity, which re­vealed Mt Welling­ton was ar­guably the best per­form­ing sub­urb for sell­ers.

The sub­urb’s prices had risen 6.5 per cent since New Zealand went into lock­down on March 25 — the sev­enth high­est rise in Auck­land.

At the same time, 89 Mt Welling­ton homes had sold so far — the 11th high­est num­ber of any city sub­urb.

That made it a great spot for home sell­ers be­cause lots of deals were be­ing com­pleted at high prices.

Sim­i­larly, Takanini with a 5.7 per cent rise since lock­down and 85 sales in 2020, and Pa­pakura with a 3.8 per cent jump and 139 sales were also seller hot spots.

Owen Vaughan, edi­tor of NZMEowned prop­erty web­site OneRoof, said first-home buy­ers had helped drive prices up in many South Auck­land sub­urbs post-lock­down.

“The cheap cost of bor­row­ing has brought more first-home buy­ers to the mar­ket,” he said.

“How­ever, they are com­pet­ing for a shrink­ing pool of avail­able homes and this was push­ing prices up.”

Although prices had re­bounded post Covid-19 in some South Auck­land sub­urbs, far fewer homes were sell­ing, in­di­cat­ing many sell­ers and buy­ers were un­sure which way the mar­ket would go.

Data by OneRoof-Valoc­ity showed 46 per cent fewer Auck­land homes sold dur­ing the first six months of the year, com­pared with the last six months of 2019.

That equated to 5560 Auck­land homes val­ued at $7.1 bil­lion col­lec­tively sell­ing in 2020 com­pared with 12,183 worth a total $19.6b sell­ing in the fi­nal six months of 2019.

New Zealand’s Covid-19 lock­down in March and April, when house sales ground to a halt for close to six weeks clearly played a ma­jor role in the re­duced sales.

How­ever, James Wil­son, di­rec­tor of val­u­a­tion at prop­erty an­a­lysts Valoc­ity, said the low sales vol­umes were also the “di­rect re­sult of a cau­tious wait-and-see men­tal­ity” among sell­ers and buy­ers.

He said prop­erty in­vestors, mum and dad home own­ers think­ing about buy­ing a bet­ter home and those in­ter­ested in snap­ping up top end lux­ury homes had all pulled back

The cheap cost of bor­row­ing has brought more firsthome buy­ers to the mar­ket. OneRoof edi­tor Owen Vaughan

from the mar­ket.

First-home buy­ers, on the other hand, were the most ac­tive buy­ers.

This drop-off in de­mand from key buyer groups had led to new op­por­tu­ni­ties, Wil­son said. Among those, Auck­land’s city centre was likely one of the best spots to hunt for a bar­gain.

With in­vestors less keen on buy­ing be­cause of the lack of in­ter­na­tional stu­dents com­ing into New Zealand dur­ing the coron­avirus pan­demic, city centre prop­erty prices had dropped 7.5 per cent post-lock­down.

Yet buy­ers still had choice. More than 200 city centre prop­er­ties had sold this year, mean­ing hid­den gems could be out there wait­ing for those will­ing to look.

Sim­i­larly, there had been 155 sales in Hen­der­son — mak­ing it 2020’s eighth high­est sell­ing Auck­land sub­urb so far.

Prices had also taken a 4.7 per cent slide in the sub­urb post-lock­down, the OneRoof-Valoc­ity house price in­dex re­vealed.

Re­muera was another sub­urb of­fer­ing choice and the sniff of a bar­gain.

There had been 132 sales in the ever pop­u­lar sub­urb, yet prices had fallen 4.6 per cent post lock­down.

Photo / Chris Loufte

The city centre is a good place to pick up real es­tate bar­gains.

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