‘Buyer’s market’ for Nelson
Nelson has seen a 7.5 per cent drop in the median house price, which now sits at $657,000. Photo: File.
It’s a house buyer’s market in Nelson at the moment according to local real estate agents, with the region experiencing a drop in property prices.
According to Trade Me’s Property Price Index, Nelson Tasman was the only region in the South Island to record a year-on-year decrease in asking prices in July. Nationwide, it saw the biggest drop, at 4.5 per cent, with an average asking price of $806,100.
The Real Estate Institute of New Zealand (REINZ) has just released its July 2024 data, showing Nelson experiencing a 7.5 per cent drop in the median house price, which now sits at $657,000.
Anthony Carppe from Bayleys Nelson says that it’s definitely a “buyer’s market”.
“There has been a reasonable correction in the market over the last 12 months… sale numbers have dropped and there is more resistance from vendors to sell.
“The market has pulled back, but if you are selling and buying in the same market, it’s relative.”
He says average sale times are taking longer.
“Some [properties] are taking three to four months to sell. But there are certainly some ‘stress’ sales and there will be until monetary issues settle, and this can affect figures.”
Despite it being a buyers’ market, he says that first-home buyers are seeing stricter conditions from banks.
“Banks are tougher on them, and they are looking at things they never used to look at.”
According to Trade Me, the price range search behaviour of buyers is significantly different from July 2023.
The number of searches in the $800,000 to $1m price range in Nelson Tasman has reduced by around 25 per cent, yet the number of searches in the $500 to $800,000 price range has increased by the same amount.
Buyer searches in the $1.2m-plus range have stayed relatively the same.
“This indicates that those most impacted by the cost of living and higher interest rates have adjusted their purchase expectations and budgets accordingly,” Ben Cooper from Change Real Estate says.
“Sellers who are wanting to sell recognise these two factors and are adjusting their selling expectations to meet the market conditions.”
Ben says the positive is that sellers who are staying in the same market can do so with confidence.
“Knowing that the same factors they are facing selling will also be at play when purchasing.”
Phil Cooper from Total Realty agrees that it is a “good time to buy”.
“We are starting to see some confidence come back and slowly more investors are coming through open homes. Plus, more first home buyers as well, but they all have choice and are definitely seeking a bargain.”
Trade Me Property customer director Gavin Lloyd says that we haven’t seen prices this low since June 2021.
“Back then the property market was just starting to bounce back after the initial effects of Covid and we ended up seeing record highs that year.
“However, in the past two years, we’ve seen almost $150,000 shaved off the average house price which may help bring back buyers to the market.”
Several banks have begun lowering their interest rates, and last week, the Reserve Bank reduced the Official Cash Rate ahead of schedule, with further cuts predicted again before the end of 2024.
REINZ chief executive Jen Baird says there has been a “downward pressure” on prices in most parts of the country this year, however, things could be changing.
“The slight decline in interest rates in July, and a belief that there are more to come, appears to have encouraged buyer activity.”