Published on: 2015-07-14
Hamilton property recovery just getting started
392 homes were sold in Hamilton during June 2015. This is the highest number of monthly sales in the city since November 2006, and compares to just 212 sold in June 2014.
However, Lodge Real Estate’s managing director Jeremy O’Rourke, said an analysis of Hamilton’s average monthly home sales over the past 19 years predicts market activity will continue improving.
“One thing about Real Estate as an industry is that it is very predictable when you look at long-term trends. A key trend we’ve just analysed is Hamilton’s average monthly home sales.
“We’ve looked back at average monthly sales to 1996 and the pattern demonstrates that Hamilton’s market recovery, following the global financial crisis, is just getting started.
“We trust the data and the data certainly predicts the number of home sales occurring in Hamilton will increase in the short- to medium-term,” explained Mr O’Rourke.
As sales volumes rise, Mr O’Rourke also said the median house price is also likely to increase.
“We’ve been saying since the start of the year that Hamilton’s median house price will crack $400,000 during 2015 and continue to believe we aren’t far away from this happening,” he said.
According to Real Estate Institute of NZ (REINZ) data released today, Hamilton’s median rose in June 2015 to $372,000 from $370,000 in May 2015. This is up from $354,000 one year ago.
Mr O’Rourke said as Hamilton’s median house price continues rising, buyers must adjust their price expectations upward or risk missing out to more aggressive buyers. This is especially true for investors.
“We are starting to see some of our Hamilton-based residential property investors missing out to Auckland investors, in particular. This is because many local property investors’ expectations are not keeping up with the reality of the market.
While local buyers balk at what they believe are ‘high prices,’ Auckland buyers are swooping in and grabbing what they believe to be ‘bargains.’
“Hamilton investors – and that goes for all buyers – need to adjust their sale price expectations or they’ll continue missing out,” Mr O’Rourke explained.
Twenty-six percent of Lodge Real Estate’s June 2015 home sales were by Auckland buyers. Lodge’s referral relationship with Auckland-based real estate agency Barfoot & Thompson means it receives a steady stream of referrals from Auckland investors interested in the Hamilton market.