Market brighter as property prices jump

STAFF REPORTERS | 11th March 2010

The residential housing market in Hawke's Bay is on the rise with a boost in property values for Napier and Hastings compared with the same period last year.

Quotable Value's report for February said sales activity was back to similar levels seen throughout 2009 with increases in new listings which expected to be turned into higher sales numbers in the coming months.

All of the main centres recorded increases but the results were more variable in the regions over recent months.

In the regional breakdown, Hastings and Napier recorded increases in property value growth for February, when compared with figures a year ago.

The average sale price of a property in Hastings was $328,950 with property values increasing by 5.2 per cent, a jump from 2.6 per cent recorded in February 2009.

Napier properties recorded an average sale price of $330,169 and values increased by 5.9 per cent in February, up on the 5.1 per cent in February 2009.

In Central Hawke's Bay property values had decreased by 8.2 per cent in February and the average sale price of a property was $218,424, although QV said the figures may not be statistically accurate as they were based on low volume of sales.

QV spokesperson Glenda Whitehead said values in the main areas had increased since 2009 but it was the rate of growth which had slowed.

"In the provincial areas, this growth has slowed even more and across the rural residential areas, house values decreased slightly over the last month," she said.

Ms Whitehead said the market was still "patchy and buyers are cautious". "Well presented, good quality properties are continuing to sell quickly and at healthy values, whereas those with less desirable attributes are proving hard to shift.

"There is activity in the lower end of the market, driven mostly by first-home buyers," she said.

"Fewer investors are actively buying and some are selling their investment properties now rather than waiting for the changes in property tax to be announced in the May budget."

Demand for new homes was steady but nowhere near the "boom levels" of a few years ago.

However Property Brokers Ltd manager Warwick McIntyre said overall there had been little change in the market.

"It's a buyer's market in that there's more properties on the market than normal and less buyers around," he said.

Many investors had been exiting the rental property market causing a boost in the lower end.

Uncertainty around jobs, pending interest rate rises and tight lending criteria continued to put some uncertainty into property values but QV hoped it would stabilise after the May budget.