The State of the NZ Property Market: Whangarei Still Shines Bright
Property data company CoreLogic has now dubbed Queenstown’s as the most at risk property market. Rentals and property in Queenstown, based on the data, can expect a significant downturn by a substantial margin. But on the upside, and perhaps a big surprise considering the doom and gloom in the papers and media, in this post-lockdown recession, Whangarei holds the title of being the least risky place to hold property!
The data is culled from four risk factors, which weighs in on how property markets perform in a downturn across 16 cities. They are then rank accordingly from the centers of highest to lowest risk.
How did these results come about? Here are the four risk factors in play that created the CoreLogic ranking scale:
- Profit performance of accommodation and food services in each center.
- Total percentage of property purchases by investors compared to the long-term average.
- The number of rental units making an income on Airbnb.
- The total number of guest nights in each center that was due to the influx of foreign guests.
Notably, other higher risk centers as shown in the rankings are Dunedin, Auckland, Palmerston North, Christchurch and Rotorua. But there are resilient property standouts that remain and they are Invercargill, Hamilton and our very own Whangarei.
To get an idea of the rankings, just look at the list below. This is based on CoreLogic's recent weighted average ranking for economic and property risk.
- Palmerston North
- Kapiti Coast
- New Plymouth
The real question here is how long ’til the dust settles?’ Though no one may know for sure, there are still investors out there who are increasingly looking at residential property as a safe and secure environment to invest. Also, there will always be a need for rental property. This may actually even increase with younger people most at risk to changes in employment status meaning that their ability to obtain finance is reduced. Therefore renting becomes their only viable option. As we all turn towards the trend of social distancing even in common everyday spaces, it has resulted in ever greater demand for good quality rental accommodation.
For now, we are still in the middle of a global pandemic, but New Zealand has been fortunate in how it has fared. Any death is a tragic loss, however New Zealand’s deaths have been mitigated through the health approach taken.
Overall property owners need to be flexible and ride the downturn. Sure, it’s a bit of a shakeup that will stretch everything in the real estate world from leasing agreements to tenancy terms and financing. Some places will do better than others. While some may take time to bounce back, they will eventually. One thing stands true – everyone is taking steps to accommodate our new normal. But for now, Whangarei is solid where it stands, and the data is there to prove it.
‘Property is always the best place to invest long term during any period of uncertainty. Over the long-term evidence shows, residential property out performs consistently most other investments. We pride ourselves on good quality rental properties and we see this focus becoming ever more important and people greater appreciate the homes in which they live’.
– Bronwyn Inglis
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