Hamilton’s Rental Market Heats Up - House Sales Stablise

MEDIA RELEASE
9 October 2012

Hamilton’s Rental Market Heats Up - House Sales Stablise

Hamilton, New Zealand - Lodge Real Estate in Hamilton, the city’s largest agency by volume, reported today that the city’s rental rates are likely to rise heading into summer.

Managing Director of Lodge Real Estate, Jeremy O’Rourke, says, “We have a real shortage in high quality properties available for rent in Hamilton. Plus, occupancy levels are sitting high at 98%.

“We have 3300 rental properties on our books, with only 66 of those available for rent. Plus, we only have 130 more properties coming up for rent in the next 60 days, so overall the rental market is quite lean.

“In the lead-up to summer, there is traditionally a higher demand for rentals in Hamilton. The market was in a similar situation last year where market pressure resulted in rental rates rising throughout the city.

“We’re also seeing a number of Kiwis returning from Australia and settling into the city, which also puts pressure on the market,” he explains.

Lodge has the largest portfolio of rental properties in Hamilton, with just over 20% of the city’s 15,000 rental properties on its books. The company also oversees around 40% of the city’s managed property market.

While Hamilton’s rental market is under pressure, the residential property market is levelling off and is in a state of equilibrium.

The number of houses available for sale in Hamilton city by Lodge increased slightly to 945 in September, up from 932 in August. House sales remained stable at 196 for the month; down just slightly from 230 in August.

Mr O’Rourke says a stable market is good news for both buyers and sellers. “At the moment, Hamilton’s housing market is sure and steady. We wouldn’t characterise it as either a buyer’s or seller’s market. It’s a great time for people on both sides of the sale,” he explained.

The Real Estate Institute of NZ (REINZ) reported on 8 October that the national median house price increased by $1,000 from $370,000 in August to $371,000 in September. Hamilton city’s median house price was $332,750 for September, remaining relatively stable compared to the median of $330,000 in August.

Mr O’Rourke says vendor greed is starting to creep into the market and largely puts it down to Hamilton sellers succumbing to the excitement being touted around Auckland’s housing market.

“With all the hype around the prices vendors are getting in Auckland, we’re starting to see Hamilton vendors assuming our local market is acting the same. As a result, we’ve seen some people listing homes at unreasonable prices or setting unrealistic reserves at auction.

“Vendors have to remember that the Hamilton housing market is completely different from Auckland. Our advice is if you want the sale in this current market, you need to be realistic.

“A market that is in equilibrium – as the current market it – is not one where you can be greedy and use price to manipulate buyers. There’s enough good stock out there giving people a range of choice and if prices are set too high, buyers move on quickly,” explains Mr O’Rourke.

-ENDS-

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