Uncertainty slows the market nationally but is Kerikeri bucking the trend?

If there is one word that sums up the current real estate environment across New Zealand it is UNCERTAINTY.

• Uncertainty about new bank lending rules implemented December 1^st 2021 and their affects
• Uncertainty about rising interest rates
• Uncertainty about the effects of the war in Ukraine and
• Uncertainty about the safety of travel as Omicron spreads.

Our experience is that most people deal with uncertainty by pausing on major decisions until the uncertain environment becomes normalised and life carries on. A lot of property markets across the country are feeling the impact of this tendency towards inaction. Fear of missing out (FOMO) has switched to fear of over paying (FOOP) and a wait and see approach is being taken by the more cautious.

Against these headwinds, our staff are still seeing plenty of interest by city dwellers who want to move to Kerikeri for a better quality of life. No longer tethered to their location close to the office, these folks are now bringing their jobs with them, to start new lives in Kerikeri for their families. The lifestyle provided by our location in the beautiful Bay of Islands, temperate climate and good schools combined with the conveniences of fast internet for work access, relatively close proximity to Auckland and an airport make this an easy choice for city dwellers looking to make a move. Consequently, Auckland is now one of the few places in the country where population is rumoured to be shrinking while the provinces prosper from extraordinary growth.

Our new listings are stacking up “Watchlisters” on platforms such as Trade Me and Realestate.co.nz. A large percentage of these are from areas outside of Northland. Interestingly, attendance at our open homes has been predominantly from local buyers. Many out of town buyers who we have spoken to are waiting for Omicron to peak before making travel plans to view our listings. Some cannot travel from being in self isolation.

While other parts of the country are reporting declining prices, Northland is an exception, rising 7.9% in the last 3 months. Kerikeri’s 3 month average median house sale price set a new record at $1,080,000 and has now been over $1 million for 4 consecutive months. We are still experiencing multiple offers on properties and especially those priced under $1million. Residential sales volumes are down 27% in the first 2 months of 2022 with 51 unconditional sales reported compared with 70 in the same period last year.

There is no doubt that the panic buying of 2021 has dropped away in 2022 and that higher stock levels are now providing more choice for buyers. Properties are taking a bit longer time to sell than last year but they are selling and prices appear to be holding for now. The trend in 2021 was for vendors to have price expectations a little ahead of the market and often above the recommendations of our appraisals.  Now our advice for vendors in 2022 is to price properties sensibly within the appraised range as they are competing with more property sellers.

If you want to find out more about what’s happening in our market or obtain a no obligation appraisal, please give any of our team a call or pop in to the office for a coffee and a chat.