New Zealand's fastest-selling suburbs are also some of the country's most affordable, according to new research.
New data analysis from CoreLogic and OneRoof – NZME’s property listing site - has identified the suburbs where properties spend the shortest time on the market before sale
New Zealand’s fastest selling suburb is Awapuni, a largely residential area in Palmerston North’s south east that borders Massey University and is popular with students. According to CoreLogic data, homes there typically spent just 11 days on market before selling, and have a median value of $373,750.
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Only seven suburbs with median values of above $1 million cracked the list – all in central Auckland. A total of just 16 suburbs where the median days to sale in the 12 months to June 2018 was three weeks or less had median values of above $650,000 – the proposed price of a new three-bedroom KiwiBuild home.
OneRoof editor Owen Vaughan said the data indicated that fast-movers to be cheaper and where value growth is higher.
“Affordability seems to be the biggest driver of quick sales,” he said.
“The most promising results came from affordable locations, meaning a lower accessible buy-in price and more substantial upside.
“The average median value of the 10 suburbs in New Zealand where the median days to sale in the 12 months to June 2018 was two weeks or less was just shy of $400,000.”
The top 10 fastest moving suburbs were: Awapuni, Terrace End and Highbury, in Palmerston North; Springvale, in Whanganui District; Mosgiel, in Dunedin; Marewa, in Napier; Akina, in Hastings; Feilding, in Manawatu; Stoke, in Nelson; and Bell Block, in New Plymouth.
Vaughan said: ““The data shows there are scores of locations across New Zealand where buyer activity is strong and properties are selling quickly.
“The best results have come from locations with more accessible buy-in prices and offer more substantial upside in terms of value growth.”
“It’s heartening that much of the activity is taking place outside Auckland, where much of the attention has been focussed.”
CoreLogic and OneRoof looked at 293 suburbs across New Zealand that had recorded 100 sales or more in the year ending June 2018, and identified 62 locations where properties spent three weeks or less on the market before selling.
The number of fast-moving suburbs was up slightly on the year ending June 2017, and was consistent with the generally slow and steady activity in the wider market.
The majority of fast-moving suburbs were located in the North Island, where property markets are generally stronger and there is higher value growth, and in areas where properties are relatively cheaper. Fast-moving suburbs in the South Island are concentrated in the south, in Dunedin, where the market is heated, and Invercargill, and the northern tip, in Nelson, Tasman and Marlborough.
The data suggests there is a strong correlation between time on the market and value gains, with fast-moving suburbs tending to see stronger value gains than those that have longer median days to sale. Nearly a quarter of the fast-moving suburbs saw median values rise by at least 10 percent in the past 12 months.
Demand in Auckland was highest in suburbs that were in Double Grammar zone – giving residents access to two of the country’s best performing state schools – or popular locations where there is a limited supply of housing, such as Stonefields.
CoreLogic NZ senior researcher Kelvin Davidson said: “Analysis of statistics on days to sell backs up what we know about other general trends in the residential property market.
“A year ago, out of just short of 1,000 total suburbs across New Zealand, there were 59 ‘fast-moving’ suburbs across the country - those with at least 100 sales in a 12-month period and time on the market of three weeks or less - and now there are 62. The stability in the number of fast-movers is consistent with what’s going in the generally slow-and-steady wider market.
“The share of the fast-movers in the South Island has been flat at only about 20 percent, concentrated in the deep south and northern tip. The dominance of the North Island in the fast-movers is consistent with generally stronger property markets and higher value growth.
“Of the 33 suburbs that appear as fast-movers in the 12 months to June 2018 and the 12 months to June 2017, 19 are in either Wellington/Hutt Valley or Palmerston North.
“Khandallah, in Wellington, has seen its median days to sell dip from 21 to 17, while Naenae, in Lower Hutt, dropped from 19 days to 16. Highbury and Roslyn, both in Palmerston North, have seen days to sell drop by two days apiece over the past year (16 to 14 and 18 to 16 respectively).
“There is also a tendency for the fast-movers to be cheaper. Of the 33 suburbs appearing in both time periods, 19 have median property values of $500,000 or less. Appleby in Invercargill, for example, has a median value of just $164,300 and seen growth of 15.9 percent over the past 12 months.
“Only one suburb that has seen double digit growth has a median value of more than $500,000 – Taradale, in Napier, whose median value is $550,350.”
Bayleys national residential manager Daniel Coulson said: “There are certain dynamics in play in the majority of these fast-moving suburbs. What we are seeing is a limited supply of properties in many of these areas, positive demand and a price point that is quite attractive and affordable for a lot of people.”
He added: "In Auckland, fast-moving suburbs tend to have a specific geographic location and a finite supply of property. For example, if you want to live in Stonefields you have to buy in Stonefields. You don't have flexibility in terms of comparable stock in the neighbouring suburbs.
“In Mt Eden, the underlying factor driving sales there is that it is in Double Grammar Zone. That aspect is non-negotiable. If you want access to Auckland Boys Grammar or Epsom Girls Grammar you are going to have to buy in Double Grammar Zone suburbs such as Mt Eden.
“That demand stays whether the market is flying along or is a bit more subdued and buyers are cautious.”
