June 2023

As listings plummet across the Hamilton residential property market, local real estate agency Lodge Real Estate is seeing demand increase, putting house prices under pressure.

The number of properties for sale in Hamilton as of the beginning of July was down to 670, compared to in excess of 900 just a few months ago.

Lodge Real Estate Managing Director Jeremy O’Rourke says in many ways, the Hamilton market is functioning like an extension of Auckland, with both cities seeing a rise in sales and interest.

“However, our significantly larger neighbour likely doesn’t realise it continues to leak people to the Waikato. Our website continues to draw more users from Auckland than any other city (including Hamilton itself). Lodge City Rentals consistently has close to a third of their new leases going to out-of-towners, with June’s data on this hitting 34%.

“Once they’ve rented for a few months and sussed out the Hamilton market, out-of-towners are then ready to buy.”

Jeremy says another factor increasing property demand is the pull for more skilled workers to the region.

“With increased immigration, we’re seeing migrants enter the market in the mid-to-high price brackets. Interest is centring on the north-east of the city, where new houses and high decile schooling is on offer, despite the slowdown in construction.

“First home buyers are finding it relatively easy to access finance, which then kicks the market upwards. I believe we’ve bounced off the market ‘floor’ and prices are starting to rise as demand swells.

“I’d be surprised if, by the end of winter, we don’t see prices stabilise in a higher bracket, which would reflect what is happening internationally.”

Lodge’s agents are seeing well-presented properties sell in competition as people become more comfortable with where the market is tracking, says Jeremy.

“The only major constraint on the market is stock. Potential vendors are sitting around, perhaps looking to pay down debt rather than make a move. But the risk is that they wait too long, and as a result a glut of properties hits the market in spring, reducing competition.

“We also have an election in three months, and I think we’ll continue to see investors remain absent from the market until they receive more certainty post-October 14.”

Hamilton's housing market has started to see the effects of increased immigration and easier access to finance, with the latter particularly evident in the first home buyer segment.

Jeremy O'Rourke