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House Prices Surge Ahead in Property Hot Spots

PRESS RELEASE
For immediate releas
From Professionals Real Estate –
Auckland/Northland Region


House Prices Surge Ahead in Property Hot Spots

Northland and Auckland house prices are holding up with some areas continuing to surge ahead, say Professionals real estate salespeople.

"Although some of the heat may have gone out of the market in some areas throughout the country, median prices for May in Auckland and Northland saw the medium selling price increase over prices in April. For both agents and sellers, there is a lot of confidence around – there's certainly no sense of doom and gloom out there," says Professionals Regional Chairman for Auckland/Northland, Gary Murphy.

This view is backed up by the Real Estate Institute of New Zealand (REINZ) figures for May, which reveal Auckland's median selling price last month was $400,000 up from $387,250 in April. Houses were selling in 37 days during May, compared to 33 days in April.

In the Auckland region, there has been a big drive in the south, with Papakura and Pukekohe in particular forging ahead, says Gary Murphy.

The median sales price for residential properties in Papakura rose $39,000 to reach $319,000 in May compared to $280,000 in April.

"Papakura was undervalued for a long time, but people have realised they are able to get a good return for their dollar there. Similarly, Pukekohe is now a very desirable place for people to live. There has been substantial growth in both areas, in terms of new buildings," says Gary.

Raewyn Wilson, owner of Star Real Estate Professionals, at Howick, confirms the market remains rock solid, with section prices in the Eastern Beaches area continuing to rise. She says any houses under $500,000 are being snapped up by first-home buyers, families and immigrants. Average prices in the area are around the $480,000 mark.

"Perhaps some buyers have been tempted to sit back and wait, because of media speculation that the market is going to fall. However, the statistics have just not backed that up and all indications are that it's not going to happen. Although we are not seeing the huge increases of the last two years, it is still a solid, steady market."

Raewyn Wilson tips Flat Bush, which is located just south of the new Botany settlement and has plans for seven new schools, to be one of the next areas of explosive growth. The number of residents in Flat Bush is predicted to rise from 3000 people at present to an estimated 40,000 people by 2021, which the housing market will be looking to cater for during the next 15 years.

Meanwhile, further south at Osborne Realty Professionals, owner Brian Barrett says that demand for top-end properties - in the $500,000 to $1million price bracket - at Clarks Beach on the Manukau Harbour, is somewhat quieter than this time last year, but the township of Waiuku continues to rocket ahead.

"Although our sales units are slightly down on this time last year, by about four per cent, we have experienced a 10 per cent increase in property value across the board, so we are actually ahead of where we were in May last year," says Brian.

"Mortgage rates have remained very reasonable and certainly we're not feeling the pinch at all. There is a very good buoyancy in the community."

In the north, Barry Joblin, owner of six Professionals offices on the east coast of Northland and Rodney, reports the whole of Northland continues to appeal to buyers – especially Auckland investors and baby boomers approaching retirement.

REINZ figures show the median house price in Northland reached $286,000 in May, up from $269,000 in April.

In particular, outlying areas such as Maungonui, in the far north, are becoming steadily more popular.

"People used to consider anything under two hours' drive from Auckland, but now they are willing to look four hours away," says Barry. "There are also a lot of new subdivisions and housing coming on to the market in Waipu and Mangawhai, which is continuing to drive growth."

Whangarei, which accounts for 45 per cent of total sales in Northland, is still the focal point of the region. In the past three years, the median house price in Whangarei has increased by about 80 per cent, says Barry, with many Auckland investors taking advantage of the area's strong rental market.

"Overall, confidence in the north is very good. We are expecting the market to level out, particularly over winter which is traditionally a slower time, but we don't expect any drop in the median price – in fact prices are still rising and we should see small increases continue."

ENDS
June 22, 2006

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