House price surge beats Auckland
With house prices in Nelson increasing at a faster rate than Auckland, recent first home buyers are thankful to be in the market.
The latest monthly QV House Price Index shows Nelson house values have increased by 16.6 per cent year on year and 4.8 per cent over the past three months, which has surpassed the rate of growth in the Auckland market.
Hunter Wright and Sandi Langridge who were featured in a Nelson Mail series bought their first home in October after struggling to find a house within their budget.
They found the three-bedroom house in central Nelson after a sympathetic property owner read about their plight. Wright said it was a ‘‘massive relief’’ to be on the property ladder and he felt sorry for those who were still struggling.
The latest statistics from the monthly QV House Price Index show the average value in Nelson is now just shy of half a million dollars at $499,866.
Wright said the average house price in Nelson was around $440,000 when he started looking a year and a half ago so it was a ‘‘quite a leap’’.
He wasn’t surprised that the growth in the region was faster than in Auckland. ’’I would believe that because as soon as the for sale sign goes up it is sold the next day,’’ Wright said.
‘‘It is sad because everyone who is renting in Nelson could afford to pay off a mortgage, it is about the same price for entry level housing.’’
‘‘I don’t know how people can afford to rent as well as save for their own home, it is near impossible.’’
Houses in the Tasman District had also increased by 14.4 per cent over the past year and 5.0 per cent over the past three months and the average value in the district was $499,082.
Remax Elite Nelson director Kate Bradley said it was an ‘‘exciting’’ time for the real estate market which was driven by demand. House listings were currently in short supply.
She said people from out of town had been looking for investment properties in the region for quite some time and they had the ability to spend more.
‘‘If you buy a million dollar property in Auckland as an invest- ment you are probably going to get $600 a week for it because it is just an average house but if you spend $500,000 here you might well get $450 to $500 here, maybe slightly more.’’
While house values had risen across Nelson and the Tasman district, they were beginning to decrease in other areas, including some parts of Auckland, Hamilton and Christchurch.
QV national spokesperson Andrea Rush said the main centres had seen a slowing rate of value growth, activity and demand in December after the introduction of the LVRs (loan-to-value ratios), which required a minimum 40 per cent deposit for investment properties and the Christmas slow-down.
QV Homevalue Nelson regis- tered valuer Craig Russell said property values had continued to rise in the Nelson Tasman region given low interest rates, strong regional economic performance and migration.
He said it would be interesting to see if the market retained the same impetus after the Christmas lull.
The number of listings in Nelson had increased over the previous three months while in the Tasman district listing numbers had remained relatively stable.
‘‘We appear to be entering the fear of missing outstage of the property cycle which combines the perception of always increasing property prices and idea that interest rates will remain relatively low.’’