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STUFF
Houses in Tasman district took an average 80 days to sell in July.
Tasman recorded the largest drop in property prices in the country in July, new figures show.
But, a local agent is warning the impact of high interest rates meant things could get worse, predicting “a bit of carnage” in September and October.
The latest property report from REINZ, released on Tuesday, showed prices in Tasman district dropped 11.3% in July 2023, compared to July 2022.
That compares to a national average price drop of 4.2%, and a drop of 8.8% in Auckland.
Nelson prices fell 7.6% while Marlborough had a 0.3% increase.
The changes brought the average sales price to $710,000 in Tasman, $739,000 in Nelson and $677,000 in Marlborough.
David White
Those hoping for a turnaround may be out of luck.
Meanwhile, houses in the top of the south are also taking longer to sell: up to 80 days for Tasman in July the longest for a July since 2001, and up from 52 a year ago. Nelson’s was at 60 days, compared to 56 in 2022, while Marlborough was down to 36, compared to 48.
REINZ chief executive Jen Baird said some vendors were dropping their prices while others “continued to hold out in the hopes of achieving their original sales price”.
“Local salespeople also reported an increase in first-home buyers and generally positive market sentiment, which has resulted in more offers in some instances.”
RE/MAX Elite owner Kate Bradley said Tasman’s figures were driven by a glut of houses in areas like Berryfields in Richmond.
After a period of people “racing into Berryfields and buying, buying, buying”, they were now seeing people wanting to move on.
Martin De Ruyter/Stuff
People who rushed to buy in the Berryfields subdivision but were now looking to sell were finding it hard to make money, RE/MAX Elite owner Kate Bradley said.
“They’re all looking for an increase in their money and not getting it.”
While not long ago you’d be looking at $1 million to buy in the popular subdivision now it was more like $850,000, she said.
Higher interest rates and people not able to afford repayments would also have an impact on the market in coming months.
“There’s going to be a bit of carnage in September, October. We haven’t seen the worst of that yet – we haven’t seen mortgagee sales, we haven’t seen desperation.”
Changes to the banking system meant clauses for finance were now stretching out to 15 days, which added to the time it took to sell, and purchasers were also being more conscientious with LIMs and builders reports she said.
The market was close to the bottom, so people should get in now before prices went back up, she said.
Mike Pero Real Estate branch and territory owner Craig Hamilton said the median price in Tasman was being pulled down by first home buyers.
Meanwhile, there was a lot of choice in the $800,000 to $1m price bracket, particularly in areas like Berryfields.
Many homes that were going to be rentals were being sold in response to rising interest rates, he said.
Hamilton believed the market was at the bottom and prices would start to go up as stock fell and demand increased again – particularly because there was little building activity at the moment.
“At some stage there will be a turnaround where the existing houses that are on the market, that’s what people are going to have to buy.”
People could still sell, but they had to have realistic price expectations, he said.
“There’s still plenty of people buying, it’s just they’ve got lots of choice, so if you want to sell you really need to have your price 100% right.”
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