How has the Property Market responded under Alert Levels 3 and 4?

Property Post Level 4 Lockdown

With the restrictions of the Level 4 lockdown lifted, it became business as unusual for Real Estate Agents and others involved in the property market. Personal movement was freed up, enabling pre-existing settlements to take place and Agents to carefully manage new viewings. At Langley Twigg, our move over the past two years towards a paperless office has really paid off. It has meant that, operating from offices at home, we could review contracts, have them signed by electronic means, and, with appropriate remote witnessing, enable our clients to settle. 

Langley Twigg enjoys a substantial share of the Napier and Hastings conveyancing markets and are accordingly well placed to provide a number of observations:

1. As we went into lockdown at the end of March, our market was extremely tight with a limited supply, multiple offers being made and good prices being achieved.
2. Properties continued to be sold at level 4 (although limited in number, contracts were entered into with a condition that settlement would take place when movement was allowed).
3. At level 3, with viewing allowed, we have received a steady number of new contracts. In several instances, multiple offers have been received at price levels greater then prior to Covid-19.
4. With the value of first home buyers’ KiwiSaver accounts bouncing back (the NZX-50 is back up to almost 90% of its pre-Covid levels), record low interest rates, and the removal of the loan to value ratio (LVR) by the Reserve Bank, the first home buyers segment that has helped drive the market over the past few years could recover quickly. Our team that looks after first home buyers have seen a stream of agreements and have picked up plenty of promising signs as sellers and buyers seek opportunities. 

What does this mean for the rest of this year as we emerge from the Covid-19 pandemic? No doubt your crystal ball is as good as ours. Some will see it as a “dead-cat bounce”. However when we consider the conditions that made for a strong market in the first three months of this year, we note that many of these still exist. Commentators have noted the likely resilience of the Hawke’s Bay economy with its low dependence on international tourism, attraction for domestic tourism, and strengths in agricultural products that are in demand in both home and export markets. Add to this the climate and lifestyle factors that make living in the Bay desirable, and we can’t help feel bullish about our little corner of the world.