Rodney North Market Report
New Zealand’s infatuation with the property market has always been very strong but the current environment would have to be unprecedented.
Every newspaper you read or news programme you watch or listen to has some sort of commentary on the real estate market in New Zealand.
Our other infatuation is with our sporting culture and, in particular, our rugby & Warriors teams. Last week the Warriors and Hilary Barry (TV3) were the only bits of news that could keep the housing market from dominating.
There are constant calls from government to step in and in some way regulate the market to prevent prices continuing upwards. Land tax is one of the proposals back on the political agenda. However, similar applications of a land tax in an attempt to encourage capital away from home ownership to equity investment, or address home affordability by artificially distorting natural market behaviour by taxation, have failed in other parts of the World. Why would the ‘powers that be’ expect the result to be any different here in New Zealand.
Other options that have been suggested to dampen demand in our heated market are, Capital Gains Tax, Stamp Duty (a set surcharge paid on a transaction), Limit Negative Gearing (predominantly for rental properties) and Restrict non-resident buyers. Whatever the option, there is healthy debate of the pros and cons of each as well as limitations. For example, a stamp duty would breach New Zealand’s free trade agreement with Korea, apparently.
The question is, would any of the options be worth it or would they have the desired effect the government is looking for?
That’s a debate we can’t answer and we can only speculate that if the government had the answers, they would most likely have acted by now.
Below is a selection of newspaper headlines that have dominated our media in just the last ten days:
Being involved in the real estate industry means that we just toil away at the coalface and work with what hand the market deals up to us at the time. While debate rages over how to manipulate it, we continue to enjoy some of the positive stories that surface. For example, take the story of Ashley Verheul, reported in the Monday 25th April New Zealand Herald. At only 24, Ashley owns a home in Auckland, a bach in Pauanui and is looking for her third property. “But rich parents didn’t get her there – she’s worked since she was 13, sacrificed nights out and saved like crazy.” It’s a good story which shows there is still opportunity – it just depends how you deal with it.
Closer to home, on the local market, it has been ‘all systems go,” much like it has been nationwide. There has been an upsurge in sales of rural/lifestyle properties in North Rodney the like of which we haven’t seen for many many years.In our March 2015 edition of White Light we reported that ‘rural/lifestyle sales recorded one of their best months in years with thirty-one sales’, however March 2016 saw that number increase by over 45 percent, to forty-five sales. We can’t remember when so many rural/lifestyle properties sold in any given month. In fact residential sales of fifty-two, for the same month, was only 7 ahead which is virtually unheard of. A small lifestyle subdivision just out of Matakana Village contributed seven of the sales but even without those it would have been a record month.
Latest figures out however, show that the trend has not continued through April which saw only nine rural/lifestyle sales transacted in the month. By stark contrast to the March result, April’s sales would be the lowest recorded over the last few years.
Residential sales numbers for North Rodney increased slightly in April to fifty-six, however the reality is that demand for all properties is still very strong and is only being restricted by the shortage of new listings coming to the market.
Sales in the Maungaturoto area are also being affected by a shortage of new listings and much of the older stock has been snapped up by dislodged Aucklanders. Residential sales here were up 250 percent, from four in April 2015 to ten in April this year. However, sales were down on the March 2016 result mainly due to falling stock levels.
Number of Residential & Rural Sales 2015 – 2016
Disclaimer: Market statistics based on settled sales recorded with CoreLogic NZ where sales from ALL sources are recorded. In preparing this document we have used our best endeavours to ensure the accuracy of all the information provided. We accept no liability or responsibility for any errors or inaccuracies and recommend that all recipients make their own enquiries to verify any information given.