Kawerau reclaims its place in the property sun
15 August 2016
One of the brightest property hotspots in the country right now isn’t near Auckland, or on Tauranga’s sunny coast.
It’s deep in the central North Island, the forestry town of Kawerau in the eastern Bay of Plenty.
Valuation service QV estimates that Kawerau’s property values have risen 41 per cent in the last year.
Houses are going for about $143,000, well up from the mere $82,000 they were selling for a year ago.
Real estate agent John Friis of Realtycom said.provincial towns like Kawerau were all hit hard after the global financial crisis, but Kawerau had regained those losses, and very rapidly.
The town had once attracted slum landlords who could buy for a mere $30,000, and investors still made up about 30 per cent of Friis’ clients, some of them from Australia.
But speculators were starting to disappear, as an increasing number of people saw Kawerau as a place they could afford.
“For example, you would pay $250,000 for a section in Tauranga. In Kawerau you can come down and get a very three bedroom home, well presented for the same money.”
Although unemployment was high in the town, there were power plant, inland port and silver mining initiatives underway, and commuters were within moderately easy reach of Rotorua, Whakatane and Tauranga.
“Generally speaking, Kawerau has changed,” he said.
Real Estate Institute data shows that house prices have surged 32 per cent across the Waikato-Bay of Plenty, due in large part to Auckland investors looking for better yields but also people moving further afield.
Rotorua has seen its median price jump from $250,000 to $315,050 in the last 12 months, an increase of 26 per cent.
Other standout central North Island performers include Hamilton (34 per cent), Tauranga (24 per cent), Hastings (22 per cent), and rural Hawkes Bay (a whopping 77 per cent).
Elsewhere around the country, investor favourites Levin and Wanganui are up 40 per cent and 23 per cent respectively, and in Nelson, Richmond and Motueka prices are up 30 per cent and 21 per cent.
Even on the previously subdued West Coast, house prices are nearly 72 per cent higher than last July.
Geoff Barnett, national manager of real estate agency Century 21 NZ, said recently that interest rates were low and many regions were performing well.
“My money’s now on the small towns and districts surrounding our main centres being the next to enjoy some good price growth.
“We’ve had the halo effect around Auckland. The next thing will be the halo effect around our other main centres.”
Source – Stuff