We cover whether house prices are really rising, the influx of Auckland buyers and our regular topics.
Current market conditions
82 Tauranga homes sold in January. January’s numbers are normally low, but that was lower than normal.
I put the likely causes down to two main factors. First, we still have fewer listings than normal. Second, there are good numbers of new homes being built, as we can see by the big increase in building consents being issued.
We’re still seeing an unusual price distribution, although it has lessened from the past couple of months. Normally homes in the $250,000 to $375,000 range account for the bulk of sales, however those numbers have been down and homes in the in $400,000 to $600,000 have been up. (See the graph below.)
The Reserve Bank’s loan ratio rules are our main suspect for the unusual price distribution.
The media have been reporting a rise in house prices, but they are getting this idea because the median house price has risen. The median is just a measure of the average price of homes being sold, and because less homes are selling in the low price range and more in the middle, it pushes the median price up.
House prices have not actually jumped up, but appear to be quite stable from what we can see.
Out of town buyers
There’s also talk in the media about huge waves of Aucklanders coming down to Tauranga. We are seeing Aucklanders coming into our market, although maybe not in huge waves. These buyers tend to buy in the higher price ranges.
Buyers and sellers
My advice from previous months stays the same. It’s a good time to sell with buyers still around. Buyers need to be prepared to move quickly with the limited number of homes available.
We’re hoping that the number of homes listed for sale picks up as we head into winter. That would allow the buyers that are out there to be satisfied and sales numbers to pick up.