Limited stock has driven competition
Auckland has grabbed the attention of property investors after its median house price hit the $1 million mark, but the latest data shows that Gisborne currently has one of the hottest markets in New Zealand due to limited stock and other factors.
Realestate.co.nz’s latest data suggests that Gisborne saw a 31.1% year-on-year price growth in November – leaving its average asking price at $561,995, which is more than $130,000 higher than in November, 2019.
CoreLogic’s latest House Price Index shows similar results, with Gisborne dominating provincial centres with a 14.6% increase in values since August and 26.3% year-on-year. The growth means the city’s average value in November was $496,990.
Meanwhile, the Real Estate Institute of New Zealand (REINZ) recorded 34.1% annual price growth in Gisborne, lifting the median price to $570,000 in October. The city has also seen the most significant annual increase in sales in New Zealand, up by 43.2% – the highest volume it has seen in an October month for 15 years.
REINZ regional director Neville Falconer said the limited stock on the market had driven competition.
“While new listings were up by 18.8% from the same time last year, the stock is selling quickly. It means open homes are very busy and auctions continue to be a popular choice with 74.6% of all sales within the region being completed by auction,” Falconer said, as reported by Stuff.
Property Brokers Gisborne acting branch manager Philip Searle aired the same thoughts, pointing to supply shortage and low-interest rates as the main reasons for Gisborne’s hot housing market.
“It’s all about supply and demand, and right now there’s lots of demand and limited supply,” Searle told Stuff, adding that the city also needs available land for new properties.
“These constraints mean the logical solution is higher density housing. Some developers are starting to go down that path, but we are not quite there yet. It is the way forward, though – in order to fulfil demand. People need to get over their attachment to the quarter-acre dream,” Searle concluded.
