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Tauranga Property Update September 2016

photo of papamoa beach in tauranga used for connect realty blog post

 

The latest QV House Price Index figures were released this week and the Bay hit another record high over August. Average house price for a Tauranga property is $633,638, up 28.5% from the same time in 2015. Nationwide the average is $612,527.  The figures show that every suburb in Tauranga saw property values increase in the last 12 months, often by more than 20%!  The top three suburbs were Parkvale (35.5 per cent), Greerton (35.2 per cent) and Gate Pa (33.8 per cent).

Interestingly actual volume of sales in Tauranga dropped 11.1% last month compared to 2015.  We believe the huge price growth we have seen this year may slow with the new LVR restrictions coming into play, however there is still strong demand from first home buyers who want to move to our stunning region.

Average rent has also increased in the last 12 months and the good news for investors is that demand for rental properties in Tauranga and Papamoa is still very strong.  As discussed in previous articles, areas such as Greerton, Gate Pa and Parkvale are seeing huge rental demand.  Papamoa also remains a favourite for families new to the area.

The Council has announced that structure planning for a new urban development area at Te Tumu is underway.  Te Tumu land lies between the eastern end of Papamoa Beach Rd and the Kaituna River.  This development is expected to house between eight and fourteen thousand people, depending on how many homes are built. Once the planning stage is completed the actual development is expected to start in 2021.

New construction and development in Tauranga is still going gangbusters as well.  In August there were 254 residential and building consents worth a total $62 million!

Finally, good news for Tauranga residents who find parking in town an issue.  With construction of the top floor now complete, the Elizabeth Street building now provides 342 public parking spaces plus 278 leased spaces, and is open 24 hours a day, seven days a week.

Time To Invest In Tauranga Rental Property

Mount Maunganui from Pilot Bay

A recent article in the Bay of Plenty Times outlined why now is the perfect time to invest in property in Tauranga and surrounding areas such as Mount Maunganui and Papamoa.

The article stated that there is a deepening rental shortage, following on from the release of Trade Me figures showing demand for accommodation in these areas continues to outstrip supply. The figures show the supply of available rental properties dropped by 18 per cent in the October-December quarter while demand ballooned by 17 per cent for the same period, and the average weekly rent also jumped by 18 per cent.

The shortage can be attributed to two factors, firstly the city’s rapid growth, and secondly the Reserve Bank’s restriction on loan-to-value ratio (LVR) lending. Nationwide the LVR restriction has prevented many first-home buyers from entering the real estate market and has forced them to continue renting. This has resulted in renters that are desperate for decent accommodation.

We find that renters come from all over, including Auckland, Hamilton and Australia. Mount Maunganui and Papamoa rentals are especially popular for these new residents, and the Pyes Pa area has also seen a huge growth in terms of demand this year. Summer is usually the most popular time, with families wanting to find a home before the school year begins.

If you are considering purchasing investment property in Tauranga, Papamoa and the Mount Maunganui areas, call Chris or Nicky for more information about the best places to buy, rental returns for the area and more.

Given the rental situation is nearly at crisis level, now is the perfect time to buy!

The Bay Of Plenty – A Great Place To Work And Live

Mount Maunganui and Ocean Beach

If you are visiting the Bay of Plenty Region this summer, and in particular Tauranga and Mount Maunganui, make sure you take the time to read the local paper and check out some of the amazing job opportunities in this Region. Besides having a similar salary base to Auckland, the Bay of Plenty has lots of job variety, including senior management positions and plenty of business opportunities.

Many people are surprised how easy it is to move away from Auckland and Hamilton, away from the traffic chaos and unaffordable house prices and rents. Not only is it more affordable, but the Region has much to offer its residents. A favourable climate which means you can grow nearly every fruit and vegetable available in New Zealand, larger sections for families, stunning beaches only a few minutes’ walk or drive away, shopping malls, a fantastic pool complex, a great arts and cultural scene and more.

So take the time to look, we can show you some of the fantastic houses we have available for rent, and if your are interested in buying an investment property we can give you plenty of local property management advice about best areas to buy and the types of rental return you can expect for you house.

We think you may decide to stay!

Contact Chris or Nicky today for more information – Connect Realty