Despite the evidence of a flattening housing market across New Zealand, Hamilton and the wider Waikato real estate market is still looking very healthy.
“With statistics now out, it is apparent that this year should behave normally, in line with historic trends,” says Lodge Real Estate director, Jeremy O’Rourke.
In Q1 of 2017, there was the usual slow-down over the holiday season in January followed by a strong bounce-back in late February through to March. As for Q2, we’ve seen a sales decrease. This was in line with the Easter and ANZAC Day long weekends in April and the usual slow-down with the coming winter.
So what are the numbers saying about the Hamilton property market? Let’s take a look.
The number of homes sold in Hamilton in April 2017 came in at 238, down from our April 2016 figure of 361—a 34.1 per cent drop in sales volume from this time last year.
Hamilton’s northern suburbs have had significantly higher home sales than other suburbs, with a grand total of 350 sales from January through to April. The western suburbs come in second at 198 sales, followed by the eastern suburbs at 182, central suburbs at 130 and southern suburbs at 109.
Compared to this time last year, the median house price in Hamilton City has grown 17.5 per cent from the April 2016 average at $458,000 to $535,000 in April 2017. While there was a 0.6 per cent drop from the March 2017 average house price, there is no cause for alarm.
“This is a very normal trend,” says Jeremy. “From these numbers, we are now projecting that it is unlikely we’ll experience any surprising highs or lows in Hamilton’s residential property market this year.”
The takeaway? While sales volumes have dropped, house prices continue to grow, but just not at the breakneck pace seen in previous years.
Despite tighter lending restrictions and a drop in activity compared to last year, property investors continue to be at the top of home sales—claiming 33 per cent of Hamilton’s house sales in May, 2017.
Movers have claimed second spot—taking up 24 per cent of Hamilton’s home sales in May. Following national trends, there’s been a rise in the number of first home buyers entering the market. These made up 22 per cent of May’s house sales.
The national shift towards a buyer’s market also means that buyers are being more cautious, and can afford to be more prudent when assessing a property.
“What this means for vendors is that listing homes at overly ambitious sale prices can cause a property to be overlooked,” says Jeremy.
“If a home is listed at an unrealistic price, it’s not unusual for potential buyers to completely discount that property, including skipping its open homes,” he explains. “This measured approach by Hamilton real estate buyers means some sellers are having to adjust their price expectations downward somewhat.”
While New Zealand’s real estate market slows, property values are still growing, especially in the Waikato. In the last 12 months, the average property value grew 11.1 per cent nationally and the Waikato by over 20 per cent.
“While we’re not seeing the same rate of growth as a year ago, the market is still in very good shape,” says Jeremy.
In May, CoreLogic reported that Hamilton’s listings were still tight compared to a year ago, which means there’s still a high demand for property.
“People are still attending open homes and coming to auctions, and buyers remain confident,” Jeremy says.
Despite the onset of winter and the usual slowdown of sales, we can expect to see the positive growth of property values continue through to the end of the year.