Christchurch is seeing a property price hike but the housing market in the city remains one of the country’s most affordable.
Unlike Auckland, Wellington and many other parts of the country, Cantabrians just don’t have as much to complain about when it comes to house prices, agents say.
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Christchurch’s median house price is around the $600,000 mark and with low listings, like the rest of the country, packed auctions and strong investor activity, mostly it’s locals taking advantage of prices Aucklanders and Wellingtonians would turn green with envy over.
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Bayleys’ residential & projects division manager Justin Haley says while there are anecdotal accounts of outsiders moving to Christchurch to take advantage of the affordable housing, his agency is mostly seeing returnees buying as opposed to newcomers.
And while the earthquakes of 10 years ago might once have been a reason to keep people away from the city, one thing an international pandemic had done was fade the city’s earthquake status.
“I hate to say it but the best thing about Covid is it’s wiped any memory of the earthquakes for us on a property level.”
While listings are low, there is no sign of a downturn, Haley says.
Bayleys is clearing 70 or 80 per cent at auction and on a regular basis exceeding vendor expectations, frequently achieving life-changing results.
A four-bedroom home in Waitikiri, Canterbury, sold for $460,000 above the reserve. Photo / Supplied
Last week, for example, a record price was set for a property in Waitikiri at a brought forward auction. “It opened at $1.4m and then bid out to $1.86m, $460,000 more than the vendor would have accepted,” he says.
Five people competed for the four-bedroom, two bathroom home at Greenbank Place, more bidders than Bayleys had expected.
But Haley says auctions have been consistent all year with multiple bidders on nearly every property - something not seen since the post-earthquake “as is” phenomenon where buyers lined up out the door.
While the hot Auckland market has been highlighted for many years, it was good to see some of that heat in the Christchurch market, he said.
What’s different in Christchurch, though, is the prices: “As much as we’re having a price hike we’re still trailing the rest of the country.”
And while Aucklanders, especially first home buyers, can get depressed missing out at auction after auction, Haley says that’s not really the case in Christchurch because they will eventually find something to buy.
“It’s not as severe here. I think that might be more Auckland-specific – the numbers to get into a home in Auckland are so much more dramatic.”
Neither do Cantabrians complain about house prices so much, he thinks.
“By comparison we’re still incredibly cheap. The West Coast and I think Southland are the only other two areas where the median house price is lower than Canterbury.”
Chris Kennedy, managing director of Harcourts Gold in Christchurch, says his agency is also not seeing an abatement in buyers.
At auction on Wednesday, the agency put up five properties which all sold with great results.
“It was designed to be an as is, where is first home bonanza. We’ve got a big auction room - we had a room full of people, standing room only, people everywhere.”
The first property up was Exeter Street in Lyttelton, an uninsured, earthquake-damaged, liveable, cute cottage, which was “scrapped over” by five bidders and sold for $685,000 (the RV is $570,000).
There was even stronger competition for a parcel of land in Castle Hill Village (6 Cheeseman Terrace) on the road to the West Coast, a gateway to four ski fields, lakes, mountain biking and tramping.
“Here’s a vacant parcel of land and ten people got their hands in the air and it sold for $395,000. Now, that’s a vacant piece of land in Castle Hill – there’s not even a shop in Castle Hill.”
This uninsured home on Exeter Street, in Lyttelton, Canterbury, sold for $685,000. Photo / Supplied
Harcourts Gold has a 90 per cent auction success rate with about 60 per cent selling under the hammer and the rest selling in the next few days.
Savvy investors are still in the marketplace, as are first home buyers and established buyers, Kennedy says.
While the market remains affordable and Kennedy doesn’t believe the area has a housing crisis, something that has to be faced is infrastructure issues around some of the new subdivisions.
“We don’t have the ability to put the infrastructure in and we also don’t have the ability to provide enough timber and steel for the roofs and so on, so tradespeople are under pressure, civil works are under pressure. It creates a massive bottleneck.”
It also means people who might be interested in buying a section and building are circling back and buying existing housing instead.
But Christchurch is fortunate because it has plenty of land to develop and that puts the city in a great position.
Asked why Aucklanders aren’t flocking to the city, Kennedy says: “They should be. Christchurch is developing into a beautiful city.
“It’s developing into something state of the art. It’s going to be a fabulous city, it’s going to be vibrant, it’s going to be young, it’s going to be ahead of its time.”
