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    Sep 2003
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    Default Buyers dictating house sale prices - Tauranga

    Buyers dictating house sale prices

    The number of house sales has picked up but the buyers are still dictating in a slower Tauranga residential property market.

    The February sales hit 100 for the first time in five months at Mount Maunganui/Papamoa and across the harbour the volume moved from a low of 90 in January to 122 last month, according to the latest New Zealand Real Estate Institute figures. Prices, however, are staying firm.

    The median selling price increased in Mount/Papamoa from $375,000 in January to $385,000.

    Last February, the median was $383,000.

    The median, on low turnover, hit a high of $352,500 in Tauranga last month, $14,750 up from January.

    Last February, Tauranga's median selling price was $297,500 _ the previous high was $351,500 in October last year.
    Over the past year sales volume at Mount/Papamoa has only topped 100 on four occasions _ so February's move looked significant.

    But LJ Hooker Mount Maunganui principal John O'Donnell said

    "I wouldn't get too excited about that; one swallow doesn't make a summer."

    He said the company's managers met recently in Rotorua and the feeling was that in the Waikato/Bay of Plenty, as in the rest of the country, prices had levelled out and while buyer inquiry was not falling it was not increasing either.

    "I think the bucket has been plugged ... the fall (in sales) has stopped and we are in a holding position and doing steady trade. If we see another month of 100 sales (at Mount/Papamoa) and 150 in Tauranga, then I would be a little more optimistic."

    He said if the New Zealand dollar continued to fall and there was no likelihood of a rise in interest rates, then more activity could return to the market.

    Mr O'Donnell said buyers were able to pick and choose at present but some vendors were getting the message that they had to drop prices to complete a sale.

    In two deals out of his office, one seller accepted $900,000 cash instead of holding out for $950,000 and a house that had been on the market for six months finally sold when the price was lowered by $55,000 to $295,000.

    Doug Morris, principal of Professionals Papamoa Realty, said the buyers were out there but the sellers had to be realistic.

    "There are plenty of examples of people sitting on high-and-mighty prices ... with the low turnover of sales we are quietly building a stock of houses. The buyers are picking those vendors who have a motivation to sell," said Mr Morris.

    "It's a bit of a slog at the moment but it's enjoyable _ you just have to work a bit harder."

    Nationally, the number of sales in February was 7930, up on January's 6360 but well below last February's 10,145. The national median selling price slipped $5000 last month from a record $300,000 in January.

    National real estate institute president Howard Morley said there were encouraging signs in February that sales were starting to get back up after the holiday period and prices showed no real sign of weakness.

    "There's one way to find out if a man is honest-ask him. If he says 'yes,' you know he is a crook." Groucho Marx


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