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Record house prices

September median of $560,000.

Gisborne house prices last month hit an all-time high median of $560,000 and realtors warn even higher prices are on the way if they cannot get more stock.

Latest data from the Real Estate Institute data shows the median price here was $176,000 higher than in September of last year and by far the the highest increase in New Zealand.

“Gisborne saw median house prices increase 45.8 percent from the same time last year to a new record high of $560,000,” REINZ regional director Neville Falconer said.

The previous record was $480,750 in July 2020.

The next highest region percentage-wise was West Coast (35.1 percent), followed by Taranaki (21.3 percent).

Mr Falconer said sales volumes remained flat year-on-year in Gisborne, the only region nationally not to increase from the same time last year.

However, listings increased 18.5 percent from the same time last year, with 64 new properties listed in September.

“This is hopefully the first sign of improved stock levels after a couple years of low listings and inventory.

“Asking prices have held strong from August 2020 and increased 7.8 percent, likely due to the continued strong levels of demand and low supply. A large portion of buyers are locals upgrading their current properties or ex-pats returning to the region.

“Demand from first-time buyers has been high, particularly in the lower price bands, which has in turn pushed these prices up.

“Anecdotally, we are hearing that obtaining finance is not an easy process and banks are taking up to four or five weeks for an appointment.”

A total of 39 sales were completed last month — the same as September last year.

The top sale was $1 million for 85 Hamilton Drive — a four-bedroom house in Sponge Bay.

Contrary to a rumour regarding the purchase, Gisborne real estate agent Shelley Donaldson said the property was bought by a couple returning home, who had previously lived in Wainui for 30 years. With a lack of quality houses on the market they “were rapt to secure a near new home in the friendly Sponge Bay estate”.

The bottom sale was $250,000 for 20B Queens Road, Elgin — a one-bedroom, 90sqm “tiny house”, with a rateable value of just $138,000.

Supply level the biggest challenge for housing market

Bayleys Gisborne franchise owner Simon Bousfield said the increase in median sale price year on year was no surprise.

“We are experiencing continued increased demand locally and nationally.

“Buyers include those moving to the region for work, investors, families upsizing and downsizing, ex-pats moving back or investing to move back, and first-home buyers.

“Interest rates falling below 2 percent are only fuelling demand. Stock is not keeping up, which is reflective in increased prices.

“Economic activity is incredibly strong. Gisborne is consistently ranking in the top three regions across the country on various economic scorecards.

“All of this points towards the need for further development to take place, creating residential section and house availability and providing much-needed options — for those both locally and moving back — to access housing.

“The need for some criteria to loosen to allow these developments to move ahead is essential for Gisborne.”

Property Brokers regional manager Joe Snee said there had been a lot more sales at the higher end of the market than usual.

“The biggest challenge is the level of stock. We need more houses. It's an easy thing to say but not such an easy thing to fix.”

Mr Snee said he would like to see the Government take action after the election to ease supply issues.

“They are trying to address the issues. It's just a matter of ensuring they do what they say they will do.

“For me, the industry itself is getting a lot of media coverage at the moment.

“A lot of that is driven by the lack of supply and that people haven't got options of where to go.”

Mr Snee said people were telling realtors that although the market price was good, once a house sold there was nowhere to go to because there were not enough houses on the market.

‘So it's quite a self-fulfilling cycle.”

TOP PRICE: 85 Hamilton Drive sold for $1m to locals returning home. 'They previously lived in Wainui for 30 years and with a lack of quality houses on the market, they were rapt to secure a near new home in the friendly Sponge Bay Estate,' realtor Shelley Donaldson said. 'This sale price is a great example of a comprehensive marketing campaign, targeting local buyers wanting to upgrade and ex-locals moving home.' Picture supplied