Kerikeri prices continue rise, inventory levels at record lows - Market Update
The news for Kerikeri is similar with other areas of the country. Prices keep rising to record levels and the number of properties for sale and the ti
What’s happening with house prices?
The quarterly median price for a house in Kerikeri for sales completed during the 3 month period of June, July, August was $925,000. That is up a massive 37% from the same period 1 year ago and up 3.9% from last month. If you had purchased a home 20 years ago at the median price of $200,000
It could now be worth over 4.5 times that. It’s no wonder so many Kiwis invest in real estate as their primary investment choice.
What are the market drivers?
As we have covered in previous reports, the effects of low interest rates, returning expats and strong migration of New Zealanders from the cities to the Far North has caused a dramatic upsurge in enquiries and sales. This has led to diminished inventory of properties for sale across the district.
The latest Covid-19 lockdowns have reinforced how people around the country can successfully work from home. We are hearing from city dwellers that they are fed up with taking the brunt of lockdowns and are now actively looking to move so they can work where they want to live. Who wouldn’t want to be near the beach or 5 minutes from the boat-ramp, versus tackling the congestion of the city and potential further extended lockdowns.
Despite the level four lockdown in Auckland we have received offers “sight unseen” on properties often from buyers desperate to find a new home in the area. Fortunately, technology allows our industry to continue operating efficiently as agents, vendors, buyers, lenders and solicitors all interact on-line. This has kept the majority of existing sales moving forward even in the highest levels of lockdown. The only slowdown has been the physical inspections by building inspectors and valuers at level 4. 
How are the number of sales tracking?
Kerikeri and surrounds had 102 unconditional residential and lifestyle house and bare land sales in June, July and August compared with 132 sales in the same period last year. A 23% percent decrease driven by low inventory levels and existing agreements being extended out past the end of August due to Covid-19 lockdowns.
Bare land sales are significantly down from 33 over the June, July, August period last year to only 16 this year. There are very few sections now left available for sale in Kerikeri and those development that have come on-line in the last year have sold out off the plan well before titles are issued and often before the works have even begun.
What about bare land sales prices?
The median price for a section under 1ha in Kerikeri was $475,000 for June, July, August compared with $270,000 last year a huge increase of 76%.
How long is it taking to sell?
Days to sell have dropped from 79 for sales in August 2020 to 27 in August 2021.
How are inventory levels tracking?
Inventory levels are down to 125 listings for sale on Trade Me from over 200 a year ago and an average of over 400 over the last 10 years. The recent lockdowns have exaggerated this as some vendors have hit the pause button on coming to market.
How many new listings are coming to the market?
New listing levels are starting to pick up as vendors who put their plans on hold come to the market and the usual Spring rush of activity begins. However, with many buyers who have already sold and are ready to buy, enquiry is very high immediately after the advertising starts and they are often flying off the shelf quickly. So, despite an increase in new listings coming to the market, inventory levels are remaining very low.
What is the outlook for the Kerikeri market?
Indications from market economists are that interest rate increases and LVR restrictions will be implemented by the reserve bank in coming months to try to kerb this continued upward price pressure. Despite interest rates set to rise, they will still be historically low for a while yet and the rule changes will likely affect first home buyers more significantly. First home buyers have not traditionally been a high percentage of the market in Kerikeri due to our above average prices. The migration to the Far North appears to be continuing strongly. Assuming these trends continue then we can expect our local market to stay strong for the foreseeable future.
Consequently, we are anticipating a busy Spring in the Far North as lockdowns lift around the country. There may never have been a better time to sell.
Pop in for a coffee and a catch up with any one of us if you are thinking of buying or selling.
Hospice update
This year we have joined forces with Hospice and are donating $1000 from each sale to help Hospice assist others in our community. Our relationship with Hospice has blossomed and we are like two families coming together. We are delighted to announce we have raised over $64,000 this year so far. The fantastic nurses and Administration team at Hospice now have two new vehicles to help with their incredibly valuable work. Every one of our team members dig into their own pockets to help with this valuable cause. We have also pledged to continue our relationship with Hospice next year and beyond. Click here to discover more...
Other news in the community
You done have to look far to see there is plenty of development going on around the town. It is great to see so much activity that is so needed to bring the infrastructure to Kerikeri required to support our incredible growth.
Domain works and skatepark
Works have begun on the revitalization works to the Domain in central Kerikeri. This an exciting time for the community and particularly for the many youth who will be able to enjoy the upgraded basketball and skateboarding facilities when completed in early 2022. Taking advantage of the Provincial Fund grants, it will create a destination for families in the community to come together and enjoy the outdoors right in the centre of our town.
Windsor Landing
What an amazing facility has been built at the end of Inlet Road. Plenty of parking, all tide access. Boat, kayak or stand up paddle direct from public space on the shoreline. It has been a long time coming and locals are already taking advantage of this huge improvement to our access to our fabulous marine playground – The Bay of Islands. Click here to locate Windsor Landing.
Waipapa Sports Fields
The first stage of the new Sports Park in Waipapa are underway with the formation of the entrance and construction of other service connections to accommodate the ablution block and changing rooms. Watch this space as the first 5 new fields, parking areas and walking areas come together in the first stage. The longer term vision has the potential to accommodate a hockey field, baseball diamonds, cricket nets, clubrooms, a dog training area, cycle paths, croquet lawns, children’s play zone and a gymnastics facility in the later stages.
Developments selling fast – Arvida, Quail Ridge and Inlet Estate
Interest has been strong in the new Arvida retirement development and 16 houses have been completed very quickly with many more under construction. Quail Ridge at the end of Rainbow Falls Rd continues to expand changing the views from the golf course and town. Inlet Estate has only a handful of packages left. Large integrated development proposals for the Bing land off Kerikeri Road behind King St and for the Brownlie farm behind the golf course have been presented to the Council. These two developments alone have the potential to house 3 to 5 thousand people.
It is becoming clear that right now is a major turning point for Kerikeri. The population of Kerikeri and its immediate surrounds have grown to nearly 20,000 now and we continue to see rapid growth far greater than most other areas of the country.
Recently our town missed out on any central government funding from Waka Kotahi NZ Transport Agency to solve our traffic problems. With over 11,000 traffic movements daily on Kerikeri Road currently, nobody has an answer to how our community is going to cope with the future challenges of moving around our town in light of the current population explosion we are witnessing. One thing is for sure, traffic is going to get a lot worse before a solution is in place.
Make sure you have your say on how our town progresses. Submit your views on Council plans including the upcoming Draft District Plan which will have affect on the next 10 to 20 years of Kerikeri’s development. Get a louder voice by participating or volunteering with community groups such as Our Kerikeri or Vision Kerikeri. Talk to your elected councillors and members of the Community Board about things that concern you. Positive change will not happen without our community having a voice.
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Apr 9, 2024
Best Time To Buy
More houses for sale, the prospect of lower interest rates, and the likelihood of improved capital gain make this the optimal time to buy a home in Kerikeri. The Kerikeri market is experiencing a unique moment in time right now. Prices have settled into their new normal, lots of new stock is coming to the market and increased buyer activity is resulting in multi-offers. Some economists are suggesting that interest rates will start to decrease sooner than expected and predicting house prices to increase over the course of 2024. I have a view that the Reserve Bank has over-crunched the economy and will play catch-up policy easing from late this year. So, if I were borrowing at the moment, I would probably take a mix of 6 and 12 month rates. “Tony Alexander Economist. For buyers, this means that for the first time in years it will likely get easier to service a new mortgage over time rather than harder. This combined with expected capital gains, means now is a great time to buy. More stock means more competition for vendors. Presentation and pricing are more important now than ever. The ones that do, are likely to see a successful marketing campaign with possible multiple offers that will result in the best possible price in the current market. We expect the current market conditions to remain steady while the economy is correcting itself. First home buyers are back and this is a welcoming sign for a healthy property market. There is always a reason why someone wants to either move up or downsize. In a steady market you will find that the gap between what you are buying and what you are selling isn’t as huge. It doesn’t matter where you are, good houses always seem to find buyers, no matter what’s happening in the market. Right now is a sweet spot for buying. If you want to find out more about how our unique, high-performance system can help you achieve your property goals please give us a call or pop into our office anytime. We would be glad to show you around and make you a coffee while you are here.
Mar 7, 2024
Market Update: February 2024
A busy start to the year! It has been a surprising start to the year for us, with massive numbers of appraisals and new listings, a slow but steady increase in buyer enquiry and a fair amount of time advising and reassuring vendors that things will get back on track. We have recorded 16 conditional sales in February but more than half of these rely on other sales chains to complete. 75% of these are under $1million. Looking back REINZ reported 12 unconditional sales for January compared with 14 in December. This is a result of the typical lower levels of buyer activity in December leading up to the Xmas period. The outlook for February at the time of writing this report looks similar to January. Record numbers of new listings and appraisals On the reverse side, the number of appraisals and new listings coming onto the market so far this year has broken all records. The paralysis caused by the uncertainty leading up to the election, the delays with forming a government and then Xmas has led to a herd of sellers coming to the market at once. Consequently, inventories have shot up with latest numbers approaching 400 listings on TradeMe up from 340 just a few months ago. This is good news for buyers and sellers. It provides more choice for buyers than they had previously except in the lower price brackets where inventory is still slim. In time, it stimulates more activity across the whole market. More inventory and fewer buyers are shifting the higher price brackets firmly into the buyer’s market category. Inventories in the over $1million bracket would take over 2 years to clear at current sales volumes and motivated vendors with deadlines are seeing the writing on the wall and reducing asking prices to meet the market. Price outlook Our feeder markets are showing signs of an upswing with Auckland prices on the rise although sales volumes are still relatively low and 70% of auctions are being passed in. Most economists are predicting that the higher interest rate levels will continue to hold the New Zealand property market at bay for at least the next 6 months of 2024. Our observations are that most of our buyers are planning to make a sideways move to Kerikeri from another area or wish to downsize. Only a few are looking to upsize. This is a sign of our economic times in New Zealand. At our current price level, even people from many Auckland suburbs find it hard to move here and release equity to live on as they have been able to in the past. Until the price differential widens again (either increases in our feeder markets or further decreases here) then some people may choose to move to more affordable parts of the country. With the majority of buyers looking to downsize, the higher demand is for lower priced properties resulting in lower inventories and leaving high inventories in the higher brackets where demand is lower. First time homebuyers remain mostly non-existent which ties to our higher than NZ average prices, lower than average wages and a challenging lending environment. Investors appear to be sitting on the fence although a few seasoned, cashed up investors are starting to play their cards as opportunities present themselves. As reported in December, much of our sales activity depends on stimulus from Auckland and other centres. Usually a major shift in these markets takes 3 to 6 months to impact on ours. We watch with interest as these markets change over coming months.