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Where the rich and super-rich buy property in NZ - 3rd Aug 2018

Where the rich and super-rich buy property in NZ

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New Zealand’s luxury property market is starting to gain momentum in regions outside Auckland and Queenstown, but there is anxiety among buyers and sellers around the proposed new rules on foreign buyers, says one of the country’s leading real estate agents.

Graham Wall, who owns Graham Wall Real Estate and holds the record for the country’s highest residential sales price, said that although most luxury properties sales were in Auckland, he was seeing increased interest in Hawke’s Bay and the Bay of Islands.

“The Bay of Islands has become increasingly popular with American buyers, and some of the sale prices there can often take people by surprise. It seems to be a very American thing to have a beach and a boat and go fishing.

“The luxury property market in Hawke's Bay is also starting to gain momentum. I've noticed a society occurring in Hawke's Bay - everyone is very fancy and the streets are full of Range Rovers all of a sudden. Hawke's Bay has a real future.

“The attraction there is you can buy luxury for less than the average price of a house in Auckland. ”

Figures released by REINZ showed an increase of million-dollar plus house sales outside of Auckland, up from 1066 in the first half of 2017 to 1363 in the first half of this year.

Northland saw a 23.3 per cent increase in million-dollar-plus sales and Hawke's Bay saw a 23.3 per cent rise.

However, the best performers, according to REINZ, were: Wellington, which saw an additional 115 houses sold over the million-dollar mark in the first half of the year; Otago (from 183 to 232); Waikato (from 138 to 177); and the Bay of Plenty (from 176 to 213).

CoreLogic senior researcher Kelvin Davidson said that New Zealand’s luxury residential property market tended to be centred in Auckland: figures showed that all 31 sales of $10 million-plus freehold residential properties in the past five years in New Zealand were in the region.

Mr Davidson said that in Auckland the median sale price of the top 10 per cent of the market had dipped in the past year, from $3.2 million to $3.1 million. REINZ figures showed that the number of $5m-plus sales in New Zealand had dropped from 55 in the first half of last year to 46 in the same period this year.

Mr Davidson said: “Since the introduction of the new LVR rules, and a more cautious approach to lending by the banks as well as reduced affordability, we've seen the top end of the property market take the hardest hit. To be fair, buyers in that bracket probably rely less on mortgage finance than those in the lower-price brackets, but it’s still interesting to note. By contrast, the lower and mid-tier properties are more likely to be seeing the strongest price growth.”

Read the full article here.

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