Property Focus - Wanaka
Vendors are seeing the market dynamics and understand that the market is more complex now, but they are still holding out for the right price in many instances which is protecting values across most levels.
The lower level of sales volumes in some areas compared to the same time last year can be attributed to a number of things – the raft of legislative changes impacting the housing market at the moment, the increasing difficulty in accessing finance (despite a record low OCR and very low mortgage rates from the banks) and vendors’ pricing expectations.
While vendors and investors take a ‘wait and see’ approach to the housing market – much like you would normally see around election time, first home buyers are steady and consistent. Speculation of a Capital Gains Tax – since rejected by the Government, the new requirements under the Healthy Homes regulations, ring fencing for tax losses on rental investments, and the offshore buyers ban has caused some investors to think twice about investing in property and has pushed some to sell their investment properties – adding to the rental properties shortage most areas face.
It is clear however, that if investors were withdrawing from the market, listings and sales would be much stronger. The lower level of sales volumes suggest that many investors are holding on to their investment properties and weathering the storm, cemented in the market due to firm values and a predicted upturn.
From 1 January the real estate industry are required to comply with the Anti Money Laundering and Counter of Financing of Terrorism Act (AML). The impact on the industry has been minor thus far – we now need to identify and verify all of our vendors. The result of this process has so far indicated little change to days to sell.
In a time of exceptional growth in tourist and resident population, the Otago region continues to offer attractive opportunities for all budgets and objectives.