Stability in Tauranga market welcomed
Tauranga has been labelled the "Steady Eddie" of New Zealand's housing market after it failed to match the growth of the other five main population centres.
Latest QV statistics comparing December 2012 with December 2011 showed that the average value of Tauranga's residential properties fell slightly to $425,880.
The 0.3 per cent dip in the average value compared to increases of nearly 10 per cent in Auckland, 6.4 per cent in Christchurch, 3.3 per cent in Hamilton, 2.9 per cent in Dunedin and 1.7 per cent in Wellington.
QV's analysis also showed that the impact of the recession was lingering the longest in Tauranga.
Whereas Auckland's average value had bounced back to be 11 per cent above its 2007 market peak, Tauranga was 11.5 per cent below the 2007 peak - lagging behind Hamilton's -8 per cent, Wellington's -5 per cent and Dunedin's -2.5 per cent. Earthquake-influenced Christchurch was up 5.4 per cent.
The average value was for all Tauranga's developed residential properties and based on sales data.
Greg Purcell of Ray White Real Estate said that Tauranga was chugging along quite nicely, with the new year starting on a positive note. "I hope we keep the Steady Eddie thing, because boom and bust is not good."
He said Tauranga did not have large corporates and a large civil service, while Christchurch's property market now had a life of its own.
Mr Purcell said people tended to forget the gains made from 2002-07, when the market went up 65 per cent.
Neville Falconer of LJ Hooker said there was not the demand to drive prices, although the number of sales industry-wide in Tauranga had been quite steady, averaging 120 a month for 2012. This compared with 2011's 102 per month and 2010's 88 per month.
He said prices had not been going up because there was ample supply compared to the number of buyers. The median price for residential properties had not changed in 2012.
Mr Falconer said the good news was that prices had not dropped away. The negative correction happened three years ago and he predicted little change until sales reached the level where they drove prices.
"There is no appetite for prices to go up."
Simon Martin of Harcourts said it was all about supply and demand and Tauranga's housing market was stable. There was little pressure on prices when 10 per cent of houses on the market were finding a buyer.
He said 70 per cent of sales were under $400,000. "That is where the market is moving most."
Jonno Ingerson from QV said the general trend outside of Auckland and Christchurch had been a flat start to 2012, growth around mid-year and a faltering finish. Most were little more than flat.
The average residential property value in the Western Bay of Plenty was $399,600, up 0.7 per cent on December 2011 but still 12 per cent below the 2007 market peak.
