Houses priced between $500,000 and $700,000 are hitting the sweet spot for first-home buyers who, according to agents, have more confidence in the market and are trying to beat any big price jumps.
A three-bedroom home, with a sleepout on Hills Rd, in Mairehau, had 100 groups through its three weeks of open homes. An impressive 11 contracts was presented to the owner by the time the deadline closed.
Ray White listing agent Michael Stewart said it was the most contracts he had ever presented to a single vendor.
“Busy would be five offers so that was very, very busy.”
Stewart said most of the offers, and the highest ones, were from first-home buyers looking for an affordable home in a convenient location.
While he could not disclose the sale price until settlement, he confirmed it was north of the $600,000 RV.
The home ticked all the boxes for first-home buyers, he said.
“A real Kiwi favourite is your weatherboard bungalow with some nice updates and a good-sized section – that’s a first-home buyer classic.”
Buyers also liked the fact that the attached sleepout could be used for flatmates to help pay the mortgage or extended family members.
A four-bedroom, one-bathroom home for sale at 232 Weston Rd, in Mairehau, is also getting a lot of attention from first-home buyers. The tender closes this week.
“Christchurch is quite cliquey, like you can buy a street over and it’s worth dramatically more because of the suburb, which is Christchurch for you. So Mairehau is a step down in terms of affordability – you can afford it so much more – but it’s across the road from a house that’s exactly the same.”
Stewart believed the increased interest from first-home buyers was due to them believing that interest rates had peaked and were tipped to drop at some point, which could push house prices up again.
“It‘s that whole idea that everyone is going ‘oh crap, prices are going to go back up’.”
Stewart said near the $700,000 mark was at the higher end of Christchurch’s first-home market and buyers in that price bracket were often getting help from their parents.
Bayleys salesperson Angela Webb said it was increasingly difficult for first-home buyers to find a house under $575,000 to make the most of the government’s First Home Grant scheme so many were forfeiting it.
“There is becoming a short supply of properties at that price level. What we are seeing is people are moving across suburbs and buying in suburbs which they previously wouldn’t have done just to get something under that price level.”
Along with Mairehau, other suburbs such as Woolston, Bromley and Hornby were also popular first-home buyer suburbs, she said.
Webb said there appeared to be more confidence in the market overall, but especially from first-home buyers.
Some investors are also starting to return to the market by looking at student rentals, blocks of flats or new builds.
“They are not really competing in that second-hand affordable first-home buyer market.”
Harcourts salesperson Zani Polson said first-home buyers were looking at around the $500,000 and $600,000 mark and should not rule out two-bedroom homes with a similar sized footprint as a way of getting their foot on the property ladder.
“It will be a little more affordable and there will be a little less competition and they still have the opportunity to add some value if they need to. But equally if they are ok with a two-bed and they don’t need an office in a room then sometimes a two-bed is just as sufficient.”
Polson said a lot of the first-home buyers were young couples and, in most cases, they were looking for standalone houses preferably on freehold sections.
“Buyers are a lot more comfortable and have a deposit and their pre-approvals and want to buy before house prices go up.”
She had also noticed an increase in first-home buyers working with mortgage brokers, which she believed was a good move so they could help work through the best options for them.
By Nikki Preston, OneRoof.co.nz
