Competition for property hot spots in Upper Hutt and the Wairarapa shows no signs of slowing following the recent jump in asking and sale prices for Wellington homes.
Diving into the suburbs, REINZ figures show that while Masterton is among the cheapest in the region, local competition is forcing buyers to compromise on their wishlist.
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Top 5 median selling price jumps in Wellington suburbs
Areas with property prices surging above 20 percent year-on-year are centred around Upper Hutt and the Wairarapa.
- Ebdentown, Upper Hutt City, $557,631 (34.4 percent)
- Masterton, Masterton District, $400,000, (25.8 percent)
- Martinborough, South Wairarapa District, $635,000 (24.5 percent)
- Trentham, Upper Hutt City, $567,500 (22 percent)
- Te Aro, Wellington City, $578,222 (22 percent)
Source: REINZ Median House prices August 2018-2019.
Ebdentown had the highest increase, coupled with a 15 percent decrease in listings. A similar situation in Trentham and Te Aro indicates higher levels of demand at play.
Silverstream in Upper Hutt City followed close behind, with a 20.4 percent jump, to $722,500.
Locals comment on sharp increases in Martinborough and Masterton
Located in the Wairarapa region, both Martinborough and Masterton have each had a significant jump in prices, as together they cater for buyers at the cheaper and more expensive ends of the market.
Just over an hour's drive from Wellington, property prices in Martinborough now rival those in the capital.
Conor Kershaw, Owner of the local P&K Four Square, said that the warm and settled climate, coupled with numerous events and vineyards, are among the reasons for the town's popularity.
"Martinborough isn't a thoroughfare, it's a destination," Kershaw said.
"People appear to be cashing out of other places and choosing to retire here."
Young families moving to or back into the area, a shortage of land for sale and the Airbnb market are making it more challenging to find a home.
"Due to the shortage of rentals and house prices, around 70 percent of our employees are commuting in," Kershaw added.
The local Te Waihinga Centre includes an events venue, library and cafe for locals and visitors to enjoy.
Further up in the Wairarapa and around an hour and a half from Wellington, locals told Newshub that Masterton is a working town with no pretense and low traffic.
With median prices well under the $500K mark and a 62 percent jump in the number of listings year-on-year, Masterton offers a lower entry point for first-home buyers and the option to commute to Wellington by rail.
Charles Spilhaus, financial adviser at Steve Sale Insurance & Mortgages, said despite the lower entry price, high competition means locals are often content with "very old and basic" properties.
"Almost every property attracts multiple offers," he said.
"Until [people are] willing to compromise and pay top-dollar for relatively shaky properties, [we're seeing them] miss out multiple times."
Reasons for growth in Wairarapa
Brad Olsen, Senior Economist at Infometrics, said growth in the Wairarapa region can be put down to strong tourism, lifestyle opportunities and low crime levels.
"If [people can] get flexible working arrangements, can work from home or are happy to commute to Wellington, [property in] Wairarapa region [is] cheaper than in Wellington."
Local food and beverage operations, including wine-making, have made the region more appealing to both locals and tourists.
"Over the year to March 2018, wine making contributed towards 3.7 percent of the Wairarapa economy, compared to just 0.4 percent nationally," Olsen said.
The number of people living in the Wairarapa and local economy growth are above or in-line with the national average.
"Health enrolments [have risen] 2.8 percent in the area, compared to 1.8 percent nationally.
"The Wairarapa economy grew by around 2.4 percent over the 12 months to June 2019, in line with national growth of 2.5 percent," Olsen confirmed.
Where to find homes under $500K
Among the suburbs that buyers might find properties for under $500K are:
- Lansdowne (Masterton District - $388,500)
- Carterton (Carterton District - $390,000)
- Featherston (South Wairarapa - $402,500)
- Otaki (Kapiti Coast District - $443,000)
- Stokes Valley (Lower Hutt - $480,000)
- Wainuiomata (Lower Hutt - $475,000)
Source: REINZ Median House prices August 2018-2019.
Home to The Beehive, Te Papa museum and the World of Wearable Art (WOW) Awards Show, Wellington offers live music, buskers, shows and markets - and an unbeatable waterfront on a sunny day.
The average asking price for Wellington increased by $52,550 (9.4 percent) in the year to August, and the median sale price across the region is $636,600.
High price growth in areas of the Wairarapa and Upper Hutt indicate that locals are willing to move outside of the capital city to snap up homes. Although budgets below $500K still have a chance, in a market playing catch-up, availability within cooee of the city is fast running out.
Newshub.
