Out-of-town parents who are jetting into Palmerston North to buy properties for their kids to live in while at university are paying good money to get what they want.
An overseas buyer bought a property that was only relisted so he could buy it for his son who is attending a language school in the area, while an Auckland mum engaged in a bidding war to buy a property for her daughter to live in when she starts vet school next year.
Bayleys Palmerston North salesperson Shelley Grieve says the four-bedroom, two-bathroom home on Silicon Way, in Fitzherbert, had been on the market earlier this year before it was withdrawn from the market.
But when a buyer contacted her looking for a property with strict criteria such as being a new home that was sunny, modern and close to the educational institutes, she immediately thought of the home.
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Grieve then contacted the owners of the property about the qualified buyer, signed up the listing that morning and later that afternoon took the buyer, his wife and son around to see it.
The buyer had studied in New Zealand as a teenager himself and knowing the value of a good education wanted to do the same for his own children, she says. The son will live in the home immediately and his wife and daughters plan to move in next year as it is also zoned for Palmerston North Girls' High.
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“I showed him one property and drove past four others that were sold so he could get an idea of values.”
Within a week, the Silicon Way home was under contract.
The vendors are “over the moon” about the sale because they had given up on selling and thought it was never going to happen, Grieve adds.
They managed to find a smaller house nearby on the same day as selling their home, telling Stuff that had sold for $25,000 over the RV - which according to OneRoof property record is above $1m - and bought their new smaller house for $100,000 under its RV.
An Auckland woman also arrived in Palmerston North to spend the weekend looking for an investment property for her daughter who is attending vet school at Massey University next year. She fell in love with the low-maintenance two-bedroom townhouse on Colombo St, in Hokowhitu, which met all her requirements including being in a safe central area, and made an unconditional offer almost on the spot.
The owners declined the offer after receiving a lot of interest in the property and the woman ended up paying $640,000 for it after fighting off four other bidders at auction last month.
Bayleys Palmerston North sales manager Karen MacGillivray says they often see parents looking for properties for their children to live in while studying in the city - a lot plan to be at the country's only vet school for five years - and they usually buy now in time for the new year.
“Especially during these quieter months with the market, they are seeing the opportunity that Palmerston North has to offer versus students in Wellington, Dunedin and the bigger centres.”
Five bidders competed at auction for a two-bedroom unit on Colombo Street, in Palmerston North. Photo / Supplied
A Filipino family won a property on Kelvin Grove Road, in Kelvin Grove, at auction for $620,000. Photo / Supplied
In August, Bayleys sold a home with self-contained unit on Kelvin Grove Road, in Kelvin Grove, for $620,000 at auction to a Filipino family living in the city, while a Singaporean man bought a four-bedroom, two-bathroom home on Johnston Drive, in Fitzherbert, sight unseen as an investment property in the first instance. The price cannot be disclosed until after settlement.
MacGillivray says there are still plenty of buyers looking for properties across the price range from $500,000 to $2m, but there is a shortage of listings as stock levels have plunged 43% compared with six months ago.
Property Brokers Palmerston North branch manager David Klue says overseas buyers are moving to the area for employment opportunities at the education institutes and hospital and are looking in the mid to higher end of the market.
The increase in buyers is resulting in more multi-offers being presented especially in the top end which is between $1m and $2m, he says.
“Good residential properties in good locations are what they are after.”
The average house price in Palmerston North is $640,000 and Property Brokers' August sales are averaging around $800,000, which he says shows that the second to third home price range is selling well.
Harcourts Team Manawatu director Richard Jensen's agents are also dealing with about half a dozen multiple offers a week. Last week one property had seven offers made on it and another had five. A home on Raumati Crescent, in Terrace End, is also being sold by tender and he expects it will attract up to 10 offers before closing on Thursday.
Jensen says they have strong buyer enquiry across all levels, which has stemmed from first-home buyers being back in the market.
“It feels like the lending at the bottom end seems to be stimulated a lot more and then obviously people buy through the markets as the bottom end moves more.”
First-home buyers can now buy a three-bedroom, one-bathroom home for the high-$400,000s or early $500,000s such as a three-bedroom, one-bathroom home at 59 Raglan Avenue in Cloverlea, which asking for enquiries over $469,000.
Jensen says stock levels are traditionally low at this time of year and they are all “waiting with bated breath” that the traditional spring life will see more properties come on the market.
“Kiwis traditionally don’t like to sell in winter. However, the buyers don’t go away – if you present a good home, they sell for record money because there’s less to compete with – does that make sense.”
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