This is a question I get asked each week, sometimes daily.
There are many commentators out there who believe its no judge at all, certainly in no way an aid to price a property. Interesting then when you look at the chart below isn’t it?
I say interesting because yes there certainly is, even over just a short 3 month time frame, no seemingly trackable pattern to this, except that is for the 2 bedroom market.
In Nelson we have a very healthy two bedroom market, divided equally amongst first time home owners commencing at the entry level, retirees and investors. And just for good measure a sprinkling of holiday units.
Another reason could be our reasonably high, for a provincial town that is, median overall price, resulting in buyers sometimes acknowledging that they can’t afford a 3 bedroom property locally and having to settle for something cheaper.
However keeping in mind the pundits thoughts on CV being some sort of measuring stick, its pretty certain that if you saw a two bedroom property in Nelson come on the the market this week and attempted to offer CV or 4% above, I reckon you will more than likely miss out based on the anecdotal that the chart suggests.
This other chart illustrates what I am talking about, the blue band at the bottom is the 2 bedroom one.
Currently the Kiwi dollar is trading north of USD$0.71c, according to news reports this morning that’s at a 13 month high.
Locally, pipfruit exporters, amongst other primary produce exporters like forestry & fish really are feeling the pains of a high NZD$.
But can there be a silver lining for home buyers?
Actually yes there is.
If you recall, look back, research you will discover that one of the primary catalysts for the commencement of the last great “property rush” was the influx of foreign, cashed up, buyers. To a tee, in the beginning the majority focused on coastal properties, not that hard to find in New Zealand.
The above chart ample illustrates the situation buyers either immigrants from the UK, or returning ex-pats from London or Manchester, face. The date I picked to show the data labels is 1st Jan, just for comparison purposes, but you’d have to say 40,000 quid is quite a bit extra to stump up with.
Will the planets align like this next time we hear the word “boom”, who knows, but one thing for sure, that in the Spring 2009 market, local home buyers do not have a lot of cashed up competition from off shore or recent immigrant buyers.