Wellington Market Update | August 2023
The buyers are back in town!
The sentiment that “buyers are back in town” is injecting optimism into real estate agents as winter transitions, bringing a prolonged listings slump to a close and warmer weather enticing prospective buyers.
“Every year, we see an increase in property listings and buyer activity as spring arrives,” states Tim Clark, Sales Director at Tommy’s Real Estate. “We anticipate this trend to continue this year, with buyer activity already showing an uptick. Therefore, we advise vendors to consider coming to market sooner rather than later.”
Tim’s confidence aligns with the latest CoreLogic report, which indicates price increases beginning in Wellington and Auckland. “Several factors suggest that house prices have reached their trough,” the report notes, citing factors like stabilized mortgage rates, potential adjustments by banks, easing Credit Contracts and Consumer Finance Act (CCCFA) and loan-to-value ratio (LVR) rules, strong employment figures, and robust net migration.
“For those with desirable properties ready to sell, our advice is to act now,” Tim emphasizes. “In July, over 60 percent of all sales in our office were conducted under multi-offer situations, which is an encouraging sign for vendors entering the market.”
Despite signs favoring sellers, Tim identifies the primary challenge in the local market as the shortage of quality stock. “The shortage spans all segments from first homes to apartments to family houses,” he explains. “There is current demand across the spectrum for well-presented properties that require no additional work.”
He highlights a shift in buyer behaviour, noting increased interest in properties that are move-in ready compared to the abundance of listings during the downturn. “Buyers are actively searching, attending private viewings, and engaging in busier open homes,” Tim observes.
“Some vendors are cautious due to factors like the impending election and concerns about market timing,” Tim acknowledges. “At Tommy’s, we advise that rather than viewing the market as at its lowest, we are witnessing a new normal.
In a stable market, buying and selling timing becomes less critical.”
While buyer activity is robust, Tim forecasts modest price increases in the short term. “We expect any rises to be gradual,” he explains. “For vendors prepared to sell, our recommendation is to capitalize on the current market conditions before the post-election and spring rush.”
In conclusion, the Wellington real estate market is poised for an active period ahead, with strategic timing potentially benefiting both buyers and sellers alike.
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