Monthly Insights

The latest insights into what has been happening in the property marketplace across Hamilton and surrounds.

May 2021

May sales of 291 were 11.5% ahead of April, up 57% on last May (incomparable due to Covid lockdown). Properties available to sell declined slightly since last month, the 30% reduction since May 2020 having significant impact on the median price, which is $117,000 higher than last May. Days to sell moving from 25 to 30 is likely the result of longer conditional contracts given the current demands on banks, valuers, builders, etc. Demand remains very strong, sales volumes only constrained by a lack of property available to sell. Buyers hoping prices will decline over the coming year will be disappointed. The huge imbalance between low supply and fervent demand continues to be fuelled by the following factors:

1. Low interest rates – most people continue to borrow one-year fixed and as banks raise their medium to long-term fixed rates, they are in some cases introducing special low one-year rates.
   
2. Expectations of interest rates rising – this can cause some accelerated buying, with people wanting to buy and lock in a low interest rate before they rise.
   
3. Our economic outlook is good – the labour market is already tight providing job security and an expectation of wage rises, people will be more inclined to buy houses.
   
4. Rising construction costs – the cost of building is soaring and this will cause some buyers to switch back to existing housing.
   
5. Construction delays – shortages of materials and tradies mean anyone wanting to buy a section and build could be waiting years for their project to even be started, some buyers will therefore revert back to looking for a house already built.
   
6. Rental shortages – the stock of available rentals properties is also which will encourage people to bring their house purchase plans forward in time
   
7. Returning expats and migrants – the expectation of most people is there will be a net population gain for New Zealand when the borders open.

If you or someone you know is contemplating selling in such a strong market, don’t delay and talk to one of our Harcourts consultants today about an up to date market appraisal and how to set the right strategy to achieve a premium sale price for your property.