PROSPECTIVE first-home buyers should not be discouraged by a newly-released survey ranking houses in Napier and Hastings as “seriously unaffordable”.
Those willing to look carefully can find affordable homes in good locations in today’s market – despite the Demographia International Housing Affordability Survey finding.
It said homes in Napier-Hastings were unaffordable because it took 4.7 times the area’s annual median household income to buy a house for the median price of $267,500.
The survey classed house prices of three times the median income, being $57,500 in Napier and Hastings, as affordable.
It showed an affordable price for a median-income house hunter is $172,500 and Hawke’s Bay Today found a variety of freehold, three-bedroom homes selling for $170,000-$200,000.
Homes in this range listed in Napier include 28 Chaucer Rd South on desirable Napier Hill and 84 McGrath St in popular Napier South on the city fringe, as well as 1/92 Nuffield Ave, Marewa, and 39 Neal Cres, Onekawa. Property guide website Zoodle described Marewa and Onekawa as “middle-class” suburbs close to Napier city centre and favoured by families.
Among freehold, three-bedroom properties listed in Hastings for around $200,000 are 923 Railway Rd South and 907 Florence St in Raureka, along with 704 Anson St, Mayfair.
Zoodle described Raureka and Mayfair as “middle-class” and close to Hastings CBD.
Hastings mortgage broker Wayne Holden, of Cole Murray Financial Services, said it was “out of the ordinary” to buy property in that price range in Napier and Hastings except in isolated pockets or where it was leasehold. In most cases, banks will not finance leasehold property.
Bevan Pickett, team leader of Quotable Value Napier, said with the limited number of suitable homes in the lower price bracket, it was important for buyers to look at a lot of property to gauge the market. He advised buyers to ask agents to look for homes that suited their needs and get advice from valuers, solicitors, building inspectors and banks.
“People shouldn’t be afraid to have offers turned down or limit themselves to a particular house type or locality.”
Mr Holden said Central Hawke’s Bay properties were more affordable. “In Waipukurau and Waipawa, you get a reasonable home for $170,000-$180,000.”
But he did not consider homes in Napier and Hastings for the median price of around $270,000 “seriously unaffordable” for buyers with the median household income of around $60,000. Generally banks lend 80 per cent of a property price, so buyers with a 20 per cent deposit, $54,000, would make weekly mortgage payments of $339.
“There are a good number of properties for which you’d pay that amount in rent, so it’s affordable.”
Mr Holden said the government’s Welcome Home Loan scheme allowed people to buy a home for up to $200,000 with little or no deposit where their household income was under $85,000.
Word on the street, P6