The Paradise Paradox

It’s hard to believe that we are more than halfway through 2019 already. We would describe the first half of the year as steady sales volumes, limited listing supply and prices holding.

The Latest Data...

Kerikeri property sales volumes were affected by the usual summer slowdown in enquiry which lasted a little longer into February this year. Perhaps it was the fine weather or fear of potential capital gains reform laws that caused the inaction - who knows.  After a few boom years from 2015 to 2017 sales volumes have now stabilised to more sustainable levels. This is no surprise as the gap between median prices for property in Kerikeri versus Auckland and other areas has closed and some investors and retirees look to other areas of the country that are more affordable.

In August the number of property listings in Kerikeri is at a 20 year low leaving buyers fewer choices and longer waits to find what they are looking for. (You can view all of our listings here.)

Annualized median prices for residential homes have levelled off at $667,000 in January and stayed at this level for the first half of this year. In June the median price is up 2.6% on the median price for June 2018. This is well above the annualized median for New Zealand ($570,000) and Northland ($485,000)

Whats driving this?

We are still seeing a steady flow of new people moving from around New Zealand to the area driven by growth in the retirement, horticulture, tourism and construction sectors. Our studies of real estate sales and where buyers are coming from and sellers are going suggests our population in Kerikeri grew, by around 200 people in 2018. In the boom years of 2015 to 2017 we were recording around 500 to 600 net new people into the area. It is not difficult to see how this population explosion has put a strain on our infrastructure with increased traffic, lack of parking and the limited choice of fully serviced sections for sale over the last 3 years.

As a result, with demand outweighing supply for houses and bare land in most price brackets, it should be no surprise that our prices have risen well above the national median. To make matters worse, our long awaited sewer infrastructure expansion has been delayed a further 7 months until mid 2020, meaning more customers having fewer choices and sometimes deciding to move elsewhere while people who have bought sections are having to delay their build plans and seek extensions to temporary accommodation and storage.  This came as quite a surprise to many as up until recently all communication from council had predicted the sewer project to be on time for late this year. One has to wonder if this couldn’t have been communicated sooner.

The Outlook.

Our outlook is for moderate price growth over the next few years with low likelihood of significant price drops (as were witnessed after GFC) due to the short supply of land available for sale and steadily rising construction costs.

We live in an awesome place that affords people who move here a warm climate, surroundings of outstanding natural beauty, a way of life they aspire to and an escape from the “rat race”. In turn we need to be prepared and planful in the way we grow to retain the very reason people desire to move here in the first place. This is the “paradise paradox”.

Our Kerikeri - Let's Make It Our Town.

There has been some great work over recent months by ‘Our Kerikeri’ to capture the views and opinions of our community, on whats important and how our town should look and feel in the future. Over 1400 people had their say and better planning was one of the 7 core goals identified. If you would like to find out more or how to participate, jump onto Our Kerikeri’s website at www.kerikeriourtown.co.nz.

• Statistics Sourced from www.reinz.co.nz