The residential property market is now experiencing restrained sales levels, as affordability pressures continue and mortgage availability remains controlled. So where exactly are the property hotspots?
Property analytics firm CoreLogic has revealed the busiest property market across New Zealand, and Tararua took the crown with the most home buyers.
Rounding out the top ten most active markets are Tararua, followed by Waipa, Selwyn, Waimakariri, South Wairarapa, Whanganui, Palmerston North, Horowhenua, Central Hawke’s Bay and Manawatu.
To get these list, CoreLogic senior property economist Kelvin Davidson said they calculated turnover rates for each territorial authority, i.e. the number of sales over the past year as a % of the area’s dwelling stock (excluding any areas that haven’t had at least 250 sales in the past 12 months).
Davidson noted these areas on the top ten list have relatively low average property values, and Tararua actually has the lowest value of the lot, at $245,853.
“In other words, better affordability in these parts of the country will have played a role in supporting demand and boosting property turnover,” he explained. “The fact that property values have also been rising relatively sharply (14% or more on an annual basis) in most of these areas suggests that the flow of listings has been ‘about right’ to keep market liquidity up but not so high that price momentum has been held back.”
Meanwhile, the markets where activity has been more subdued include Rotorua, South Waikato, Gisborne, Auckland, Far North, Hauraki, Porirua,Thames-Coromandel, Kaipara and Wellington.
“That said, we need to take care in the case of Wellington – there, activity levels have been restrained by a lack of property actually available to buy, rather than the primary factor being weak demand caused by affordability pressures,” Davidson said.
CoreLogic Buyer Classification series also suggests mortgaged investors have re-emerged as the most active buyer group in Rotorua over the past six months or so. Davidson noted this may well be contributing to supply pressures, given that new landlords buying into the market for the first time do not free up another property.