Covid Ignites Coastal Property Boom
Covid-19 has been a key instigator in the explosion of interest for coastal properties over the past nine months, says one New Zealand real estate leader.
Owner of Century 21 New Zealand, Derryn Mayne, says Covid-19 has fast-tracked more people working remotely and lured more people to the coast.
“Last year’s lockdowns showed a lot of Kiwis, and their employers or clients, that remote working is not only achievable, but a lot more acceptable. What’s more, the pandemic has spurred on a global appreciation for coastal living, greater human space, and the healthy outdoors generally,” says Ms Mayne.
She says not only are coastal properties now popular, but so too are lifestyle blocks, and semi-rural communities with Century 21’s five Waikato franchises frantic albeit listings are still at a premium.
“When you also consider that overseas travel is out, while interest rates remain at record low levels, the attraction of waterfront and coastal real estate makes total sense.
“People are also conscious that the Reserve Bank is re-introducing loan to value ratios (LVRs) in March. With holiday homes viewed as investment properties, Kiwis are keen to get in now before banks require bigger deposits from most investors,” she says.
The Century 21 leader says as well as very low debt servicing costs, a coastal property is now more doable for many Kiwis thanks to the likes of Bookabach, Bachcare, and Airbnb. People can cover their expenses by letting out their holiday homes with domestic tourism demand strong.
“Sure, many people factor in uncertainties about sea level rise and insurance, but in the end the pure attraction of waterfront property will always heavily outweigh any future risks.”
Ms Mayne says over the past nine months the industry has observed Aucklanders getting priced out of Coromandel, Raglan, and Rodney. Many bach buyers are looking further afield, with the Bay of Islands, Coopers Beach, and Karikari Peninsula now taking off.
“We’re seeing many new areas coming into play. The Far North, for example, has arguably been undervalued as a destination for too long, but that’s all changing. More holidaymakers and investors are discovering Northland for the first time, and access is improving thanks to projects like the Puhoi to Warkworth motorway set to open next year,” she says.
Derryn Mayne says while uncertainties remain over 2021, those waiting for property prices to fall could be very disappointed.