- Christchurch’s real estate market is steady with a consistent demand and stable house prices.
- Agents report an expectation gap between buyers and sellers due to high property volumes.
- First-home buyers and relocators find Christchurch attractive for its affordability and vibrant city life.
Christchurch’s real estate market is being hailed by agents as steady as she goes. Those who work in the southern city say that’s a nice alternative to the more up and down markets seen in some parts of the country.
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The agents highlighted the benefits of living in a vibrant city coming together since the heartache of the earthquakes of around 15 years ago.
Chris Kennedy, managing director and business owner of Harcourts Gold, said the market over the past six months had been an interesting one – not a rock-star one but not dead flat either.
There was an “expectation gap” between buyers and sellers, which he put down to there being plenty of stock and, therefore, plenty of choice for buyers.
“We see offers being made, and if they are not accepted, buyers move on pretty quickly and make another offer.”
The gap varied from property to property and from location to location, he said. The Halswell and Wigram area, for example, had high volumes of properties for sale, including existing housing, new builds, and land and house packages, and in a lot of cases people bounced from one fairly standard home to another.
At the time of writing, there were 244 homes for sale in that area, which Kennedy said was a lot.
He was not expecting much to change going forward, and definitely not expecting to see the “phenomenal” peaks from after the earthquakes, and after Covid.
“Our market here is somewhat stable in terms of its values. The reliance is on the volumes, so we need the volumes to make the gain.”
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The post-earthquake recovery set Christchurch apart from other areas because of the amount of house building that had gone on, and the opening up of land for future development.
While that kept a lid on pricing, Kennedy said if sellers had the correct price, position and presentation houses sold well: “We see some phenomenal results in our auction rooms.”
He pointed to a sale on Hyndhope Road, in Kennedys Bush. The house was built in the 1980s but made to look before its time, which was on a large parcel of land.
Five bidders fought for the property, which sold for $1.758 million, so while there was an expectation gap, it was not stopping people from buying, Kennedy said, adding that the auction clearance rate was sitting at around 72%.
“If buyers and sellers can get over the gap, then there’s good results to be had.”
People from Auckland were still looking at relocating to Christchurch, and not just for cheaper housing.
A three-bedroom heritage-style home on Hyndhope Road, in Kennedys Bush, recently sold at auction for $1.758m. Photo / Supplied
“There’s not the same dangers, there’s not the same commuting issues, there’s not the same infrastructure issues that you see in Auckland.”
Christchurch was becoming an attractive low-rise city with “really cool spaces”, beautiful buildings and modern architecture.
“We’ve got the stadium due to open soon, we’ve got the new sports centre due to open soon. There’s just so much going on that’s reopening and starting to bring huge value to the city.”
Among those buying were first-home buyers, a lot of whom were using KiwiSaver for deposits to secure homes, Kennedy said.
“It’s encouraging to think there are so many people that have adopted the KiwiSaver process and are putting it to great use. There’s nothing nicer than, and nothing better than, being able to own your own home.”
Rachel Dovey, general manager of Bayleys Canterbury, described the market as consistent and said she expected that to remain the case.
OGB Bar and Restaurant in Christchurch. Agents highlight recent improvements in the city centre and the range of restaurants and activities. Photo / George Heard
She pointed to OneRoof figures which showed the city’s average property value rose by 1.4% to the end of May, which was only $4000 shy of the record high of $802,000 from June 2022.
In contrast, Auckland and Wellington’s house prices are not expected to recover until 2028 and 2031.
Dovey said it was astounding where those major cities were sitting compared to Christchurch: “What we are seeing is a rather consistent market that is not dramatic.”
Value increases, albeit small, gave the market confidence because it was travelling in the right direction, and that made for positive conversations with clients coming to market.
Dovey said the summer market had been positive but a late Easter impacted cycles and while May was a good month the appetite of vendors had recently slowed for reasons that were unclear.
The lowering of the Official Cash Rate, with more to come, was positive, however, and she said Christchurch had Canterbury University going for it with nearby accommodation popular with investors.
“Investors are steady and they are obviously making the most of the reduction in the OCR but we are hearing that rentals are a little bit more softer but we are still gaining a lot of new rentals, a lot of properties to manage, so I think that’s still reasonably positive.”
Dovey said it was not just Aucklanders interested in moving to Christchurch but people from around New Zealand, and that was probably because the city was looking “amazing”.
“The infrastructure is great; great restaurants, all of that, and, again, the university and schooling is second to none, and the cost of living and the cost of housing is more affordable, so they are the key drivers.”
Also positive was that the city was flanked by agriculture and farming and Fonterra payouts had been strong.
“I think because our market is not just a typical city, it’s multifaceted in terms of the businesses that supply agricultural and farming and all of those things, so we’ve probably just got a little bit more liquidity in this marketplace compared to others that are just pure cities.
GV Financial Services founder Gareth Veale: “Access to borrowing has always been good in Canterbury." Photo / Supplied
“If you look at Wellington, you’re not getting flanked by farming and dairy and all of that. That’s probably also another factor that just holds the [Christchurch] economy.”
Bayleys auction clearance rate in the room had been around 50% and 60% with good attendance and good transactions afterwards, she said.
Richard Withy, director/sales and auction manager with Ray White Metro, also described the market as consistent with good buyer demand.
“Sales volumes have actually been quite strong comparatively to last year so that’s really good to see.
“Probably interest rates pulling back a bit has helped a few more people getting into the market and having that confidence to enter or buy up and buy down and transition.”
Well-presented properties in good school zones or close to amenities were selling well, he said.
“Probably more centralised to those two things really count, so your classic areas are Boys’ High, Girls’ High.
“I think the southern part of the city, Cashmere High zone, is very, very popular, and good primary school zones.
“Out close to the sea, those lifestyle type locations, Sumner, Red Cliffs, Mount Pleasant, are performing very well also and we’ve seen some great results out in that location.”
Ray White had also seen an active first-home buyer market, and Withy said the townhouse market in the central city had a lot of supply and was very competitive, along with new subdivisions in north Canterbury.
“Those markets are a bit more challenging where you do have a lot of supply.”
People seeking relief from high house prices and living costs north of Cook Strait were still moving to Christchurch and finding an attractive city with a strong economy and stable but comparatively cheap house prices.
“We’ve got an office in the central city and I’m just sitting here looking over the Terrace – it’s just great to see a real vibrant inner city.
“There’s people in and around all the time. In the summertime you’ve got the boats coming in; the stadium getting rebuilt, the metro facility opening, conference centre really coming into its own, so all those things, those anchor projects, have worked for the city.”
Withy said their auction clearance rate was sitting around 55% with a lot of homes selling shortly after the auction and that the 90-day clearance rate was in the mid-80%s.
“That shows we’ve got a healthy market. Over the last few months our sales are still outnumbering our listings whereas probably last year/the start of this year was a little bit different so we’re starting to see the sales volume really be quite positive.”
Withy expected a robust winter: “I don’t think it’s going to suddenly go into hibernation.”
Broker Gareth Veale, of GV Financial Services, also said the market was looking healthy.
“Access to borrowing has always been good in Canterbury because we’ve got comparable incomes to the rest of the country but the housing market is a lot more affordable.”
A couple with little debt and average incomes could afford a three or four-bedroom new home with two bathrooms and a garage for $800,000 or $900,000, “whereas in Auckland you’re dreaming and you might get a two-bedroom townhouse for that”.
Veale was seeing a lot more people refinancing in Christchurch and taking advantage of low interest rates, and a slow return of people thinking about investment properties had started.
“The interest rates getting down to 5% have certainly made the arithmetic a lot better.”
These were mum and dad investors rather than professional investors, who Veale said had been stymied by things like the debt-to-income ratios.
Veale felt the market had picked up in Christchurch while other parts of the South Island were not as buoyant: “I have to measure myself sometimes because there’s a bit of depression up in Auckland.”
But where Christchurch’s market had small increases, it had not had the same “massive” increases following Covid in other areas so the market was never broken, he said.
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