Christchurch is proving to be a hotspot for first-home buyers who have been snapping up properties at a price unheard of in most of New Zealand’s large cities.
The majority of houses that sold under the hammer in Christchurch’s auction rooms last week were in the $500,000s or under price range and most were snagged by first-home buyers eager to finally get on the property ladder.
Harcourts Gold salesperson Cameron Bailey said houses in the $400,000 to $800,000 price bracket were usually the first to move – both when the market dropped and now when it appeared to be stabilising.
“What I think is happening is there’s an acceptance of a new norm. People can clearly see that prices have come back from where they were a year or so ago and now it’s exciting.”
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It offered good buying, he said, because a property worth $700,000 a year ago was now probably $600,000.
In some areas a three-bedroom home can be picked up for somewhere in the vicinity of $500,000 such as this three-bedroom home at 42 Te Rama Place in Wainoni, which has an RV of $480,000 and is going auction at the end of the month.
Bailey said while it was still possible to purchase a property in the $400,000s, stock in this price range was scarce.
An investor snapped up a modern one-bedroom apartment for $442,000 on Latimer Square. Photo / Supplied
Last week he sold a modern one-bedroom, one-bathroom fully furnished apartment on Latimer Square for $442,000 after it was withdrawn and sold during the auction.
At the same auction, a three-bedroom home on Peverel Street in Riccarton, marketed at both first-home buyers and families, sold for $535,000.
The apartment sold to an investor, but Bailey said the majority of properties in the lower price range were being bought by first-home buyers.
Of the eight properties that sold at Harcourts Grenadier's auctions last week, five were priced under $600,000.
A three-bedroom, one-bathroom home on Chartwell Street in Burwood sold for $470,000 – $120,000 less than its RV – while a three-bedroom, one-bathroom home on James K Baxter Place in Spreydon sold for $577,500 – $42,500 under RV.
There were also six bidders battling it out at a mortgagee auction earlier in the week with the three-bedroom house on Masham Road in Broomfield selling under the hammer for $472,000, less than its RV of $560,000.
There were six bidders battling it out during the mortgagee auction for a property on Masham Road in Broomfield. Photo / Supplied
Ray White Metro sales and auction manager Richard Withy said there were people thinking they were going to get a “deal or a steal” who are feeling a bit more confident now that interest rates may have peaked and so are back in the market.
“Some of that first-home buying market has definitely sprung back into life. Our mortgage brokers have definitely been commenting on the same that they are seeing those first-home buyers rather than just having pre-approvals in place, they are actually coming through in terms of contracts.
“I think we might have found that the market has normalised. It’s not changing dramatically anymore – buyers and sellers both realise that if they want to move, which is ultimately why they are in the market, they just need to get on and do that and have some common sense in terms of the approach to it.”
Withy said people only had to compare Christchurch’s house prices with Auckland, Wellington, and Tauranga to realise how affordable it is.
A three-bedroom, one-bathroom home on Jebson Street in Mairehau recently sold for $522,000. Photo / Supplied
Ray White has sold several properties in Christchurch priced in the mid-$450,000s to early $500,000s so far this month, including a three-bedroom, one-bathroom home on Jebson Street in Mairehau for $522,000.
And while some first-home buyers were looking in the lower existing home price range, Withy said others were paying between $700,000 and $800,000 for a new-build.
Bayleys Canterbury general manager of sales Rachel Dovey said there was definitely an opportunity for people to buy properties in the $500,000 price range at the moment.
“I don’t feel like it’s been a surge in that price bracket. There certainly has been a few and they do have good interest. Where else in New Zealand in a city that’s doing so well and got so much going on can you buy [for that]?”
Even a bungalow in central Christchurch with potential to renovate can be picked up for $700,000 or $800,000, a price she said would be unheard of for a similar character home in Auckland or Wellington.
Dovey said all signs were pointing to the market declining and being at or near the bottom.
“We are quietly optimistic. We don’t want it to take off. I think it’s fair to go up reasonably, but to stop going down is a good sign.”
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