Just when I thought I was done, some new bit of news comes along that gets me excited again. Excited because I own property and like most of you, property is my key asset. If it’s worth more money I’m happy as it increases my wealth. I know it’s supposed to be bad for the economy but seriously I question the logic behind that.
So for the great news… Core logic have released their June figures. Growth in Auckland year on year has now hit 17%. Ya! Boo! Sucks not to be an Aucklander. Tauranga has now hit 7.3% up on last month’s 6.75%. But the really exciting news is good old Whangarei has leap frogged Hamilton in growth hitting 4.6% year on year. Last month we had 3.9%. So just as predicted the growth rate is accelerating. What I did not see was Whangarei’s’ growth rate passing Hamilton’s. Whangarei now has the third fastest residential housing growth rate in the North Island.
The most likely cause is Aucklanders! They are to blame for everything good and bad that happens in New Zealand. Earlier in the year we discussed the ripple effect as Aucklanders took advantage of the record prices in their city and moved out of Auckland and purchased in the provinces. It made sense that Tauranga would grow faster than Hamilton as it is a smaller version of Auckland with its harbour location. However the same logic applies to Whangarei. It has the harbour location and therefore logically should appeal to Aucklanders, more than the complete change in geography that Hamilton provides. And although the Aucklanders leave the big city for a quieter provincial life they do bring some of the city with them , which is great for the cafes and businesses in town that benefit from the different spending patterns of city folk! Not so good for the tractor salesmen and fertilizer merchants but good for the boat shops and real estate agents.
The long and the short of it is that the property growth rate in Whangarei is going quicker than I had anticipated and I now think my earlier prediction that property growth would hit 7-8% by Christmas is conservative and a figure of 9-10 % is more likely.
Tip! If you are thinking of buying, factor this in... That property you are looking at for say $400,000 now is likely to be $450,000 in December. So rather than risking losing the property by beating the owners up with tough negotiating, you are better to pay their price, secure the property , and rely on capital gains to get you that bargain. Come Christmas the price you paid will look cheap.
Tell us, are you moving on the property market? Buying, selling or both?