PHOTO: Lodge Real Estate managing director Jeremy O’Rourke
Despite high interest rates and a continued wait-and-see approach from investors as New Zealand heads into the crux of the election campaign, a strong group of enthusiastic buyers are keeping Hamilton’s property market buoyant.
Lodge Real Estate managing director Jeremy O’Rourke says August was an expectedly average month for listings, with 715 houses on the market – slightly up from 640 the month before – indicative of the end-of-winter lull.
Investors, however, are a key group of buyers who are noticeably absent.
“There is ongoing hesitancy from investors. Many are waiting to add to their portfolios until post-election, after they get a chance to see what the post-election policy spread will bring.”
Jeremy also says an added factor suppressing investor activity is the continued low supply of appropriate housing stock in the city.
“We’re seeing many investors who are stuck with properties, for example people who became accidental landlords in the past 18 months because they couldn’t get the right price when they wanted to sell. And now they’re faced with one of those properties being subject to the Brightline Test.
“If there is a change in government and we do see some of these measures such as the Brightline Test and interest deductibility relaxed, we may see an influx of those “accidental landlord” homes come back the market. If that happens, it would serve to alleviate some of the market pressure that’s coming from low supply. However, on the other hand, it could further constrain the rental market.
“But again, we’ll just have to wait and see what October brings.”
Jeremy said a positive in the Hamilton market is that other home buyers are making decisions and they’re taking that strong intent right through from offer to closing.
“There’s a little bit more choice out there for buyers than there has been this winter, which means we’ve seen more sales come through simply because buyers have found the right property at the right price.”
He says for sellers, it’s important to price property appropriately from the outset.
“We’re seeing properties that are priced correctly for the market, and have good marketing behind them, get more people across the doorstep. If those factors are aligned and working, buyers are responding strongly.
“We saw this recently where one of our agents listed a townhouse, with 54 competing properties on the market alongside it. Most of the townhouses were priced by negotiation. Instead, our agent priced it appropriately and his listing quickly received three offers in competition.”