It’s all happening in the New Zealand property market right now. All over the country cash rich buyers from Auckland are queuing up to buy investment properties everywhere. And it is not just the major cities. Recent open homes I attended in Hamilton, Cambridge, Wellington, Levin, Whangarei and Tauranga saw 50% of the interest coming from Auckland-based buyers. It is now common for there to be at least 10 people lined up waiting before the open home viewing even begins. The agents get 3 offers on the day and the property is sold 3 days later. People are so sick of missing out that they are forgoing due diligence in order to get in first and secure a deal. Obviously, as agents acting for the buyer The Property Finders do not agree with cutting corners when buying such an important asset. We get in to see the open homes during the week, before that mad weekend rush, which allows a few days for you to conduct your due diligence.
The rapid rise in values in Hamilton and Tauranga since about mid 2015 has been well documented. This increase in values has continued but at a slower pace than at the end of last year. In Hamilton the last 3 months have seen values increase 3.7% which is much slower than the 10.2% we saw in the three months to October Likewise in Tauranga where the Q1 prices have increased 5.5% compared to 7.8% ending in December 2015. Buyer classification analysis shows 14% of the sales in Hamilton so far this year were to Auckland investors, which incidentally is down from a peak of 27% in late 2015. In Tauranga it is 12% and climbing.
But it is not just those two cities seeing values driven up by Aucklanders. North of Auckland values in Kaipara have risen 6.8% in the last 3 months, and a slightly more sedate 4.0% in Whangarei. To the south it is Aucklanders and to a lesser extent Hamiltonians seeking more affordable properties helping to drive up values in Waikato District, Thames-Coromandel, Waipa, Hauraki, Matamata-Piako, and Western Bay of Plenty.
As we move further afield values in Opotiki, Rotorua, Napier and Ruapehu are all up around 4% while much of the rest of the central North Island is increasing but only very slowly. The heat comes on again in the Wellington area, which some are describing as the new Auckland when it comes to property market fervour.
Over the past year the Wellington market has become progressively tighter as demand out-stripped the supply of new properties coming up for sale. We now see the total number of properties listed for sale in Wellington being only half of what they were this time last year. This comes at a time when demand is very high with attendances at open homes in Wellington City by dozens or even hundreds of groups not unheard of, and multiple offers being made very quickly. Unsurprisingly values have been rising quickly since September and over the last three months are up 4.2%. The rise in values in the Hutt Valley, Porirua and Kapiti Coast are slower but the demand is beginning to spread there as the city market heats up.
The impact of Auckland investors is much less in Wellington than further north. According to our buyer classification only 4% of Wellington sales in the past three months have been to Auckland investors, up from the 2 to 3% we have seen for the past few years. First home buyers have remained steady at 26% for the past few months; meanwhile other investor activity has climbed further to account for 40% of all sales.
Activity like this has not been seen in the New Zealand property market since the 1960s so if you are a Kiwi living abroad who ever expects to return to live here you might want to consider getting back into the property market before it becomes unaffordable anywhere in New Zealand. And, of course, we are also specialists in helping overseas buyers navegate their way in an unfamiliar market. We are watching the market closely and are actively buying for overseas clients every day. We are your eyes and ears and find properties for you to purchase as though we were looking to purchase it for ourselves. We provide you with plenty of detail and photos so you see exactly what we see and we tell it like it is, warts and all. Many of our clients have purchased sight unseen and trust us to find the best property at the best price that best meets your brief. So don’t delay contact us today.