Real estate agent sees glimmer of hope in provinces

Real estate firm First National New Zealand believes the provincial property market is leading the way in the property sales recovery, with buyers and sellers in the nation's towns looking at a more settled year in 2009. However, holiday home areas that are reliant on discretionary money are still quiet, First National General Manager John Stewart said. These are areas such as North of Auckland, Coromandel, Taupo and Queenstown. South Island provinces have led the way in the recent recovery, notably the Southland region. Another highlight was the lifestyle block market around Alexandra, Stewart said. First National's network of offices currently has just under 10,000 listings, up from figures of 7,500 in May. "Listings in the last five to six weeks have been around the 9,000 to 10,000 area." "Listings has not been the major problem this year. The problem is finding people who are prepared to make offers," Stewart said. First National said that it had recently experienced an increase in attendance at open homes. "Open home attendance is significantly up on earlier low levels. For some areas that means 12 groups instead of four. For other areas it might mean six groups instead of one or none." Stewart said that in many areas of the country, sales volumes for the last six weeks are at the same level of the last six months combined. "If the last three years were taken out of the equation, we would be looking at record sales figures in some markets," he said. "It's not 2007 action, and neither should it be, but we are increasingly seeing glimmers of hope." "Sales volumes are up on the previous low levels of the year. While prices are not what they were a year ago, they are at a level where sellers are accepting of them and increasingly buyers realize they reflect fair value." "In Southland, which has had a tough time, sales last month were more than for the period from April through July," Stewart said. In the North Island, "Taranaki doesn't seem to stop and is the most positive region while Hakes Bay is perhaps the hardest hit." This [Taranaki] can largely be put down to the strength of the dairy industry, he said. "While the dairy industry had pushed the rural market along, recoveries in the meat and wool, crop and food prices were likely to provide a wider spread of fortunes for the provinces." First National has also experienced an increase in interest from expatriate New Zealanders in recent weeks, who are looking to buy as the dollar drops. "One origin of increased interest is from expats in the Middle East, along with immigrants from the UK." Stewart said that although sales in the provinces seem to be reviving, the main centres and holiday home areas are still sluggish. For example, although the Tauranga city area is sluggish, the provincial areas North of Tauranga, such as Katikati, are improving, he said. First National echoed comments made by Barfoot and Thompson last week that the spring weather might have a positive impact on the housing market. "With a likely drop in interest rates being forecast for this week, and better weather which strangely does have an effect on sales, we believe the market has bottomed out in the provinces and better times are upon us. Perhaps there are people deciding that after a very wet and cold winter to be in another house or area before next winter arrives."