Hibiscus Coast/Orewa Market Commentary.
In Hibiscus Coast, the residential market remained relatively flat with subdued quantity of sales throughout 2010. However throughout 2011 the market has picked up with both higher sales volume and increases to the median sales price recorded. 2012 built further on these positive gains and this has continued through 2013 and into 2014 as the nearby Auckland market remained hot due to a lack of listings. Sales numbers have eased slightly following the introduction of Loan to Valuation Restrictions (LVR) in late 2013 with the market for lower priced properties more subdued; however shortage of listings in nearby North Shore is attracting more first home buyers to this region.
In November 2014, 143 sales were recorded for the Hibiscus Coast area, up on the previous month (118 sales) and higher compared to the same month last year (101 sales) according to REINZ figures. March 2013 recorded the previous high of 154 sales. It's now taking an average of 38 days to sell, up on last month (37 days). The average days to sell, apart from one adverse result in February 2011 of 81 days, usually fluctuate between 36 and 60 days, however the past six months has seen some results bucking this long term trend underlying the growing pressure on the quantity of available properties for sale.
The REINZ median house price for November 2014 is currently sitting at $650,000, a 3.2% increase on the previous month's result of $630,000, still supporting a rising trend evident since the beginning of 2012. The past 12 months have recorded median house price levels well in excess of $500,000, with the last quarter of 2013 and early 2014 largely recording results in excess of $600,000. The most recent peak in March 2014 saw a result of $657,000. These are all positive indications that home-buyers and investors are moving to the Hibiscus Coast market as an alternative to the market-shortage situation being experienced in the neighbouring North Shore suburbs.
Current rents for Orewa/Whangaparaoa for a two bedroom house range from $365 to $430 per week, and for a three bedroom house $430 to $530 per week.
Agents continue to report a shortage of listings for good family homes in the lower to mid-price range; this has lead to greater competition among first home-buyers and investors, and thus causing the market value for these properties to increase particularly in areas such as Red Beach and Stanmore Bay. Some agents reported having no listings whatsoever as demand into mid 2014 has exceeded supply. Reports indicate that the LVR appears to be affecting mostly the first home buyer market which tends to be in lower price ranges, and we have seen, generally, falling house sale numbers but continued increases in median house prices as higher value homes continue to sell in the past five months. Across all of Auckland, the main driver continues to be a shortage of housing stock and with increased migration to this region this is likely to continue for some time. Only other economic factors such as rising interest rates, falling employment and slow economic growth will see any reversing trend in median prices emerging in the medium term.
Overall, demand for good quality family homes especially along the central and western end of the Whangaparaoa Peninsula and on the flat of Orewa is still fairly strong, with drivers appearing to be from families looking to establish themselves on the outskirts of the Auckland Metropolitan area, Retirees looking for a beachside/quieter lifestyle the Hibiscus Coast offers, and new buyers unable to find suitable available properties in the North Shore, so look to the Hibiscus Coast as an alternative coastal destination.
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