C21 Market Pulse | April 2023 | New Zealand

C21

WELCOME TO THE April 2023

ISSUE OF C21 MArKET pUlSE

p UB li SHE r

Century 21 New Zealand Ltd

CONT ri BUTO r S

Tim Kearins

Jen Baird

Cameron Brewer

ED i TO ri A l ENQU iri ES

Century 21 New Zealand +64 9414 6041

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Century 21 New Zealand

+64 9414 6041

D i SC l A i ME r

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TOUGH W i NTE r AHEAD FO r MANY HOME-OWNE r S

BY TIM KEARINS, CENTURY 21 NEW ZEALAND

This latest OCR hike was not unexpected. In fact, it’s getting close to what the Reserve Bank forecast some time ago.

Recently, the Reserve Bank lifted the Official Cash Rate by 50 basis points, taking it to 5.25% – its highest level since 2008 when it reached 8.25%.

RBNZ earlier forecasted a peak of 5.5% this year.

Historically, six or seven percent rates have been about the average for Kiwi borrowers, with one and two-year rates at retail banks now starting to stretch to the top end of that.

Given so many had locked in at two or three percent, it will be a tough winter for a lot of homeowners re - setting with a much higher interest rate.

Another concern is first and nexthome buyers’ access to credit.

Here’s hoping the banks assessments and stress testing of applicants doesn’t get so prohibitive that fewer and fewer are able to borrow in the first place. That would only exacerbate any issues in and around the real estate market.

The Government promised last year that it would get slightly less prescriptive with home loan lenders, but stories from the frontline remain mixed,” says Mr Kearins.

More than ever it’s important for prospective borrowers to know that it doesn’t all begin and end with the big banks. Mortgage brokers can often deliver more competitive rates and greater borrowing flexibility.

For first-home buyers who can cobble together a deposit and secure finance, one small mercy is that in a softer market they can often make up some ground with a good sale negotiation by their real estate agent.

As well as more opportunities out there for buyers, it’s potentially a prudent time for some renting to take the plunge, with rents continuing to head north not helped by shortages.

The pressures on rental stock have only grown this year, not helped by the Auckland floods and Cyclone Gabrielle. What’s more, 1 April hasn’t helped tenants, with landlords being further hit by a further loss of tax deductibility on their mortgage interest costs.

Not only have thousands of Kiwis had their houses yellowed or red stickered, over 20,000 are on the public housing waiting list, and thousands remain in emergency housing including motels. This adds incredible pressure on rental property availability, and hence rents won’t be easing any time soon.

MBIE’s Tenancy Services Rental Bond Data released in March showed that median rents nationwide are up $175 per week since 2017 – reaching $575.

For tenants sick of paying sky-high rents, who are fortunate enough to possibly buy, they should do their initial sums on a mortgage calculator. Despite rising interest rates, they might still be surprised. Then they need to shop around to get the best deal.

www.century21.co.nz

Contact Tim Kearins, Century 21 New Zealand – (0274) 495-547

M A r KET pACE S l OW, ACT i V i TY i N THE r EG i ON STA r TS TO REAPPEAR

BY JEN BAIRD, REINZ CEO

The Real Estate Institute of New Zealand’s (REINZ) March 2023 figures show the continuing impacts of the economic climate with median prices and sales counts easing and properties taking longer to sell.

REINZ Chief Executive Jen Baird, says there is no denying the current economy is influencing market activity.

from 14,923 to 18,742, an increase of 3,819 properties annually (+25.6%). Month-on-month, inventory increased 0.5%.

"WHILE WE HAVE SEEN ACTIVITY PICK UP IN MARCH, THIS YEAR’S SUMMER SEASON HAS BEEN MUTED. PRICES HAVE EASED AS WE CAN SEE, AND PROPERTIES ARE TAKING LONGER TO SELL. BUYERS ARE TAKING THEIR TIME, THEY ARE NEGOTIATING, AND SOME ARE WAITING TO SEE IF PRICES EASE FURTHER"

Nationally, the median price decreased 12.9% annually to $775,000 in March 2023. Days to sell have risen to 45 days for March 2023 – up 9 days compared to March 2022 and down 15 days from 60 when compared to February 2023.

At the end of March, the total number of properties for sale across New Zealand was 29,284, up 3,625 properties (+14.1%) year- on-year, and up 0.7% month - on-month. New Zealand excluding Auckland was also up

“Inventory levels are returning to the long-term average, which presents an opportunity for buyers looking to take advantage of the lower prices and less competition. REINZ members tell us first home buyers are actively returning in the regions with the advantage of choice as investors remain absent,” says Baird.

The total number of properties sold across New Zealand in March 2023 was 5,877, up from 4,113 in February 2023 (+42.9%), and down 15.0% year-on-year. New

Zealand excluding Auckland sales counts decreased by 10.0% year-on-year but increased 34.3% month- on-month.

“There are clear signs that we are in the lower phase of the cycle, but with nearly 6,000 properties sold, vendors who are motivated to sell are meeting the market with more realistic expectations on time frame and price. Those who need to sell are still selling.”

Nationally, new listings decreased by 17.7%, from 11,224 listings in March 2022 to 9,242 listings in March 2023. Compared to February 2023, listings increased by 13.5% from 8,143 to 9,242. New Zealand excluding Auckland listings decreased 15.2% year-on-year from 7,191 to 6,099. Auckland’s listings were down 22.1% from 4,033 to 3,143 year-on-year with the only regions increasing being Taranaki (+9.7%) and Marlborough (+18.6%).

“The weather events of the beginning of year are still being felt

ANNUAL MEDIAN PRICE CHANGES

in those regions heavily impacted. The market is likely to remain in this phase as New Zealanders wait for peak of inflation, a settling in interest rates and some clarity around the possible outcome of the election. That said, with the number of listings continuing to ease, we may start to see the supply/demand balance change in some areas.”

The REINZ House Price Index (HPI) for New Zealand which measures the changing value of residential property nationwide showed an annual decrease of 13.1% for New Zealand and a 11.5% decrease for New Zealand excluding Auckland.

Click here to read the full report

Source: REINZ Monthly Property Report 18 April 2023 .

F ir ST-HOME BUYE r S NEED TO CHECK OUT GOVE r NMENT ASS i STANCE

“Kiwis considering buying need to know that different government assistance is available to get them on the property ladder. It could make all the difference, but many don’t even know these opportunities exist,” says Tim Kearins, Owner of Century 21 New Zealand.

Government assistance schemes includes First Home Grants, First Home Loans, and First Home Partner.

First Home Partner is a shared ownership scheme to help aspiring first-home buyers purchase a home together with Kāinga Ora. First Home Partner is aimed at those whose deposit and home loan aren’t quite enough to buy a home that meets their needs.

“For example, a couple secures $620,000 for a $730,000 purchase, and Kāinga Ora stumps up with the $110,000 difference. Both parties then enter a shared ownership agreement. It’s an attractive scheme that’s helping a lot into their first home and well worth investigating,” says Julius Capilitan, Managing Director of Century 21 Financial.

Last year to better reflect market prices, the Government increased the house price caps for the First Home Grant and entirely removed house price caps from the First Home Loan.

First Home Grants give eligible first-home buyers up to $20,000 for a deposit. First Home Loans allow eligible buyers to purchase a home with a five percent deposit with no price caps.

“For sure it’s harder for buyers with less than a 20% deposit to get finance due to the Reserve Bank’s Loan-To-Value Ratio (LVRs) restrictions, but these schemes make it much more possible to secure a mortgage. My advice is talk to a broker, but first get on the Kāinga Ora website to understand their products better and see if you’re eligible,” says Mr Capilitan.

Julius Capilitan says most buyers hungry enough will get finance and will get into a property.

“We’re still seeing plenty of approvals from banks, despite what you may hear. There are always exemptions to the rules and while it’s never easy, it’s certainly not getting harder,” he says.

Mr Kearins says given the current cost of living crisis, coming up

with a sufficient deposit is often the biggest hurdle. He says the Government needs to better promote its first-home buyer assistance.

“There are no silver bullets to home ownership, but these schemes certainly help many young Kiwis get over the line. Given the opportunities for buyers out there, this winter may prove to be the best time in a long time to get on the property ladder,” says Tim Kearins. www.century21.co.nz

Tim Kearins, Century 21 New Zealand – (0274) 495-547

Julius Capilitan, Managing Director, Century 21 Financial NZ –(027) 2777-352

Julius Capilitan

T HE SEC r ETS OF SUCCESSFU l HOME STAGING

Staging your home is an essential step in the home-selling process. It allows potential buyers to visualise themselves living in the space, making it easier to attract interested buyers and sell your home faster. By highlighting the best features of your home and creating an inviting atmosphere, you can make a lasting impression on potential buyers.

Here are some key tips for staging your home to sell:

CLEAN AND DECLUTTER

The first step in staging your home is to clean and declutter. A cluttered home can make it difficult for potential buyers to see the true potential of your space. Take the time to organise your belongings, get rid of any unnecessary items, and give your home a deep clean.

NEUTRALISE THE DECOR

When staging your home, it’s important to use neutral colors and decor. This will make it easier for potential buyers to envision themselves living in your home. Bright colors and bold patterns can be distracting, so keep things simple and elegant.

FOCUS ON CURB APPEAL

The exterior of your home is the first thing potential buyers will see, so it’s important to make a good first impression. Focus on improving your curb appeal

by mowing the lawn, trimming hedges, and adding some colorful plants. A well-maintained exterior will make your home more inviting and attractive to potential buyers.

LIGHT IT UP

Proper lighting can make all the difference when it comes to staging your home. Make sure to let in as much natural light as possible and use artificial lighting to highlight key features of your home. Dark, dingy rooms can be a turnoff for potential buyers, so make sure your home is well-lit and inviting.

DEPERSONALISE YOUR SPACE

While your personal items may have sentimental value, they can be distracting to potential buyers. Remove any family photos or personal items to help potential buyers envision themselves living in your home. A depersonalised space will make it easier for buyers to imagine themselves living in the property.

CREATE AN INVITING ATMOSPHERE

When staging your home, it’s important to create an inviting atmosphere. This can be achieved by adding cozy blankets, fresh flowers, and other decorative elements. Make sure your home feels warm and welcoming, so potential buyers will want to stay awhile.

HIGHLIGHT KEY FEATURES

Make sure to highlight the best features of your home when staging. This could be a beautiful fireplace, a spacious backyard, or a stunning view. By drawing attention to these key features, you can help prospective buyers see the true potential of your space.

By following these key tips, you can successfully stage your home to sell. At Century 21, we know how important it is to make a good first impression, and we can help you every step of the way. Contact us today to learn more about how we can help you achieve the best possible result when selling your home.

p OWE ri NG U p pA pAKU r A WO r KS FO r C21 NZ TO p OFF i CE

“Combining our real estate strengths and geographical reach has made Century 21’s Local Realty on Broadway, Papakura a force to be reckoned with. It has been a great move,” says Derryn Mayne, C21 NZ’s Papakura Branch Manager.

Her comments follow Century 21 Gold Real Estate in Manurewa joining forces earlier this year with the Century 21 Local Realty to create a mega-office in Papakura.

All eyes will be on Century 21’s first quarter awards, announced next month, to see what impact the merger has had on Local Realty’s real estate sales and property management.

The fourth quarter of 2022 saw several of Local Realty’s real estate stars shine. It also won Top Office for the Quarter for Units (the number of properties listed and sold), Top Office for GCC (Gross Closed Commission) and Top Property Management Office (Under 250 managements).

Manurewa has kept its property management book, managed by Janine Hair. Ms Mayne says clients are happy with the move. The service remains first-class, with the office priding itself on its proactive and hands on approach.

“Operating under the same roof is proving to be a huge advantage and sees us positively growing the pie. There’s a lot of cross-over with Manurewa and Papakura and so now we can more actively help each other with leads and local knowledge,” says Ms Mayne.

Opening in late 2019, Local Realty has performed incredibly well despite Covid-19 restrictions, lockdowns, and now a challenging real estate environment. Franchise owners are Iresh Tennakoon and Gary Bal.

“It’s great having Derryn on board at this time in the real estate cycle. She opened her Manurewa franchise in 2008 during the Global Financial Crisis, and so understands how to not only overcome tough times, but grow the business and recruit and train more agents to establish us as a local leader,” says Gary Bal.

The move is viewed as a great advantage to both buyers and

sellers, as well as landlords and tenants.

“Having Manurewa join us builds on our offering and reputation in the marketplace. For over a decade, Derryn and her team built one of South Auckland’s most successful real estate offices. We are now amplifying that experience, together with our well-known marketing expertise, to deliver the exemplary service Century 21 is famous for world-wide,” says Iresh Tennakoon.

Owner of Century 21 New Zealand, Tim Kearins, says the real estate company is delighted with how the merger of Manurewa and Papakura has worked out.

“The Papakura office serves such an important and strategic part of Auckland. It covers some of the region’s key residential growth areas as identified in Auckland’s Unitary Plan, with massive change and development ongoing. A bigger and better Local Realty is at the heart of

Gary Bal, Derryn Mayne and Iresh Tennakoon.

it, building its market share every day,” says Mr Kearins.

As Papakura Branch Manager, Ms Mayne oversees the sales team and property management team, and is responsible for recruiting new salespeople in the area.

“Our catchment is now huge, meaning more listings and choice for buyers and more rentals to view for tenants. On top of this, we’re backed by Century 21’s well recognised global brand and unbeatable reach locally and internationally,” says Derryn Mayne. www.century21.co.nz

Derryn Mayne, C21 NZ Papakura Branch Manager – (021) 399-431

Iresh Tennakoon, Century 21 Local Realty Franchise Co-Owner –(027) 453-0333

Gary Bal, Century 21 Local Realty Franchise Co-Owner –(027) 604-0504

ABOVE LEFT: The Century 21 Local Realty office.

ABOVE: Iresh Tennakoon and Gary Bal with the honourable Judith Collinsat the opening of their office.