The seasonal Spring surge in real estate sales has failed to arrive in New Zealand this year, with property owners happily renting rather than selling as they can obtain good rentals over the summer, it is claimed.
Owners of luxury properties, particularly second homes, are putting them up for rent and are achieving high prices.
Concern about a mini boom leading to another real estate downturn next year is also making buyers and sellers more cautious.
The number of sales has increased and the time it takes to sell has shortened while prices have risen but this has not resulted in a sharp surge in the market. The latest New Zealand Property Report from realestate.co.nz shows listings are up only 7% cent to 13,550 compared to a 21 per cent rise at the same time last year and 16% in 2007.
‘We are seeing a certain confidence in the market through people searching on the site and also people listing their property. The seasonal uplift though in listings has not happened as it did in years gone by,’ said chief executive Alistair Helm.
Indeed many may be taking heed of a warning from Reserve Bank Governor Alan Bollard of a future debt-fuelled, housing-led boom of the kind that preceded the recession.
The owners of luxury holiday homes though are cashing in. They are renting them out over the busy summer period for eye-wateringly high prices, according to Campbell Bevan of high-end holiday home website AmazingAccom.com.
‘In the recession, a lot of people think that it would be good to get some sort of income from their second home,’ he said. Some rent out for up to $3000 a night during the peak season.
Demand has been as high as ever for the coming summer with the most popular homes booked out months in advance. Waterfront homes on Waiheke Island are always snapped up quickly, and the more people they sleep, the better. ‘The value is better and a lot of families want to go away with another family or extended family,’ he explained.
There is also demand for less expensive holiday rentals as fewer people are booking holidays abroad this year. Australians are also looking for rental accommodation as are British people visiting relatives.