Red-zoners help push prices up

01:54, Aug 10 2012

The latest batch of red-zoners have begun househunting and are tipped to start boosting demand and prices for homes in their own neighbourhoods.

Almost 300 homes around the cliffs of the Port Hills were red-zoned at the end of June, following 200 red zonings in Southshore in May, bringing the red-zone total of homes to be cleared to over 7500.

Demand from river suburb red-zoners spreading out has already helped push up house prices by an average of 5.8 per cent in Christchurch in the past year and more in surrounding districts, according to data from valuation agency Quotable Value (QV).

Real estate agent Rae Manson, from Ray White, said red-zoners from the hill and coastal suburbs were turning up at open homes now.

"We are just starting to see them out investigating the market. A lot of them want to stay in the area."

Harcourts agent Andrew Swift said the new land classifications in suburbs such as Southshore had freed up both red and green-zoners to make real estate decisions. Like Manson, he was seeing owners keen to buy locally.


"We've noticed activity has greatly increased over the last few weeks. They're not buying yet but they are starting to look," Swift said.

"Most of them want to remain in the area, whether it's because they have strong ties like a business or kids at school, or because of attractions like the beach. There's still good affordable housing on this [the east] side of town."

Manson said insurance difficulties were still making sales of TC3 (blue-green) homes difficult, and buyers preferred homes with minor or repaired damage over those with bigger earthquake claims outstanding.

The QV figures put the city's average house price over the past three months at $385,564, about 2 per cent above its previous 2007 peak.

All parts of the city have seen values rise, even the most earthquake-damaged eastern suburbs, and the most growth in values within the city was in the southern and western suburbs.

The Selwyn and Waimakariri districts saw values rise an average of 13 per cent and 13.9 per cent respectively in the past year, the most in the country.

Values in both districts are well above peaks from 2007, when the property boom was coming to an end.

Ashburton and Timaru have also seen values grow because of post-earthquake demand, with rises of 6.7 per cent and 5.6 per cent respectively.

QV valuer Daryl Taggart said Christchurch's real estate market was busy but there was still a shortage of listings. First-home buyers were being encouraged into the market by low mortgage interest rates, while investors were starting to be attracted by increased returns.

Meanwhile, sales figures from the Real Estate Institute show homes sold in a median of 28 days in the city.

The Press