Price drops are luring first-home buyers back to the Auckland suburb that starred in 2021’s record-breaking run of The Block NZ.
Ray White agent Derek von Sturmer told OneRoof he sold two entry-level homes in Point Chevalier within two weeks of them hitting the market.
Both saw solid numbers at open homes and fetched between $1.2 million and $1.5m.
“Last year entry-level was up to $2m. A place we sold last year - a three-bedroom, one-bath home on a cross-lease site - fetched $1.98m. You’d be looking at $1.4m now,” von Sturmer said.
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House prices in Point Chevalier gained national attention after the suburb was chosen as the location of the ninth season of The Block NZ.
In the reality TV series’ grand finale, the winning house sold under the hammer for $2.825m - the most money a Block NZ house had achieved in the show’s 10-year history.
At the time, von Sturmer was selling homes in the suburb for more than $4m. He told OneRoof that while the downturn had altered the market, lower price points were now attracting first-home buyers to the suburb.
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“Point Chev is its own little climate. That entry-level is kicking off and then you get the flow on effect. I’m really excited for this year, we’ve missed that first-home buyer for so long.”
Von Sturmer said first-home buyers were taking notice of media reports and no longer just looking, but actually buying.
Agents in neighbouring suburbs had noticed an uptick in first-home buyer activity. Barfoot & Thompson Royal Oak manager David Armstrong said first-home buyers still faced challenges getting finance, “but can see prices have dropped and there’s not so much competition".
He said that any properties with consenting or code of compliance issues were immediately rejected for bank lending, so buyers were reluctant to look at do-ups. He even had one buyer negotiate with the vendor to paint the house before the sale in order to satisfy the bank, which was happy to add another $10,000 to the price.
Another entry-level bungalow on Point Chevalier Road had two offers after 20 groups viewed the property. Photo / Supplied
“It feels quite positive. We’ve got auctions where there might be four conditional buyers lined up afterwards. We’re encouraging them now to turn up to the auction to negotiate straight away after it is passed in at auction. The vendors are there, it can all get done.”
Steve Hay, Barfoot & Thompson’s Mt Roskill manager, said that buyers needed to be realistic about prices, and not to expect big discounts.
“People are wanting to buy but a lot are relying on what they’re hearing in the media. They come in with very high expectations. It can be very frustrating.”
A new report released this week suggests that while price drops have benefited first-home buyers, affordability gains are being wiped out by interest rate rises.
The report, by CoreLogic, found that Kiwis are spending more than half of their income (53%) on mortgage repayments to service an 80% LVR mortgage.
CoreLogic chief economist Kelvin Davidson said that news may improve this year, as mortgage rates flatten off and incomes grow.
“It’s fair to suggest that the worst has passed in this cycle for housing affordability, and as mortgage rates peak, the next few quarters should look more favourable for home buyers," he said.
“There’s always a trade-off. Eighteen months ago prices and deposits were the big issue. Now you need less of a deposit, but mortgage rates are high."
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