Christchurch Market Update
If you are looking for a realistic and less speculative market than many other areas around the country, then Christchurch may be the location for you. With its affordability, oversupply (which is finally lessening) and the re-build taking serious shape, it's no secret that many people are moving back to the city and its surroundings, embracing a new and innovative city.
For those of you not aware, Christchurch City Centre (which expands beyond the CBD) was the most searched for location in the South Island on trademe property back in January. This clearly shows there is no lack of ‘interest’ towards the garden city.
While the cities population fell after the earthquakes it has recovered and had already exceeded its pre quake levels back in June 2017. I’m optimistic it is onwards and upwards from here.
Latest statistics from QV show many of the upper end areas such as Fendalton, Cashmere and Merivale are now selling for around their 2016 CVs. Areas still offering good value are Avonside averaging 12% below CV and Phillipstown of 10% below, which are predominantly investor owned areas. Popular suburbs such as Riccarton and Upper Riccarton are showing signs of slowly creeping up with their average buying price sitting around 5% below CV. Riccartons popularity stems from a combination of strong student demand being close to the University, close to Riccarton Westfields Mall, sits within the Christchruch Boys and Girls High school zones and also lies on the cusp of the CBD and Hagley Park.
Prices range from approximately $730,000 down to $190,000 respectively in the above suburbs with returns ranging from 3.5-4% up to 8%.
Typical yields around Riccarton, depending on property type are around 5 - 6.5%. I’m currently working with a buyer on a house we have under contract in this location, which, off the negotiated purchase price will potentially achieve 6.5% Gross Yield and at a spend of approximately $15,000, converting the large laundry into a 4th room will increase the rent by an estimated $40 p/w.
If your vision is long term then now is the time to buy, with minimal competition around, makes buying easier all round. Its easier for making offers, negotiating without the urgency you experience in the more competitive markets and being able to secure long due diligence periods to ensure you are buying right. Rents are a little stagnant and growth will likely be slow in the short term, however ,if your plan is for the long term then the big picture from the current market will likely be a very different story from now.
Two of the larger projects due a couple of years from now which should have a major impact on the city are:
- Metro Sports facility expected to open early 2021 – this is intended to be the largest aquatic and indoor recreation and leisure venue of its kind in New Zealand. More detail on this spectacular project here
- Convention centre - the $475 million convention centre is expected to be completed in early 2020 more details here
Another exciting event to keep an eye on is the move of the Shirley Boys and Avonside Girls to QE11 Park. This rebuild is set to be the
‘ultimate campus’ for more than 2000 students. Expected opening date is term 2, 2019. Suburbs surrounding this area are mainly lower decile
and very affordable… may be a good time to explore some of these surrounding suburbs now! More info here
Maxine represents iFindProperty in the Christchurch Region.