Quake-safe house prices lift

16:00, Nov 08 2010

The earthquake may have given a minor boost to property values in undamaged parts of Christchurch.

Quotable Value (QV) spokeswoman Melanie Swallow said yesterday there had been a "small lift" in values across the city last month, "but only in suburbs where there has been little or no earthquake damage".

She said those areas were seeing demand for quality housing, with some healthy prices being paid and some houses selling within two or three weeks.

"This is a very positive sign, indicating a strengthening market," she said.

"An increase in demand for housing in unaffected suburbs is exactly what our valuers expect to see."

Swallow said that because of the earthquake there had not been enough sales to give an accurate picture of values in the city.


The last average value reported for the city by QV was $373,264 for the three months to August, she said.

There was also little data for parts of Canterbury outside Christchurch.

Swallow said insurance payouts would help stimulate the economy and help kick-start the housing market.

Sales were taking longer to go through while people waited for engineering and land infor-mation memorandum reports, she said.

"But at this stage, the post-earthquake sales recorded for Christchurch are very encouraging."

In other parts of the country, QV's data showed values had slipped, with values in the three months to the end of October 5.5 per cent below their peak of late 2007, but just above the post-peak low of 2009.

QV national research director Jonno Ingerson said there had been no sign of the traditional spring surge in sales.

He did not expect any significant increase in sales before the new year.

Christchurch valuer Bevan Fleming, of Valuation Solutions, said that with large parts of the city off the market because of earthquake damage, there should be increased demand in undamaged suburbs.

"If you take large chunks of Christchurch out of the market, I guess that supply-demand equilibrium would be out of skew for a while," he said.

"But in reality it's hard to see what that is doing to values because there are so few sales."

He said future price statistics could be misleading because sales had been affected more in the cheaper eastern suburbs.

Fleming said many people would be avoiding selling now because there was "so much negativity" about the housing market.

"The people I'm talking to are pretty pessimistic at the moment, whether they are investors or homeowners."

He said the number of sales would be unlikely to increase this year.

Real estate agent Bob Muir, of Ray White, in Shirley, said he had not yet seen a rise in prices in any part of town. "People are not sure of what's happening," he said.

"They don't know what happens with a damaged house if you sell it.

"They are all sitting around waiting for [quake] assessors to come around.

"A lot of people want to sell, but they just don't know what to do."

Muir said that sales had been slow, even before the earthquake.

Two factors could boost sales in the next few months – the annual shift into popular primary school zones before February and people on holiday deciding to move house when they came back.

"Things can only get better," he said. "They certainly can't get any worse."

The Press