McPherson Property Management Blog

The Christchurch market place for residential properties, both sales and rental one year post earthquake is clearly divided into 2 markets. 

The Central City, Eastern and Hill suburbs, with low enquiry making sales and letting difficult to obtain.

The contrast in the North and Western suburbs plus the outer districts is opposite, lack of properties available for sale and rent putting upward pressure on house prices and rents. 

It has been difficult to obtain a clear trend and population movements with an initial exodus of approximately 26,000 according to election role stats.

The red zone property owners are now receiving the Crown offer to purchase their properties that is now 6,000 people who will be making housing decisions over the next 9 months, building, buying, renting or moving outside Christchurch.

The sales market in the least affected areas are experiencing strong inquiry from first home buyers, people transferring to Christchurch and Red Zone buyers, creating multi offers and excellent auction clearances.

In the rental market available properties are below pre-earthquake levels again, with strong enquiry on homes in the least affected areas with rents firming.   The opposite is happening in the eastern suburbs with low enquiry and difficulty attracting tenants.

Insurance, or inability to obtain cover is a major issue.  Insurance companies are not taking on new business exposure in Christchurch; the only cover obtainable is through assignment of a policy or renewal.  This is okay for existing properties where the income owner has a good credit rating, but for new builds and tenants seeking contents insurance the current situation makes it extremely difficult to obtain cover. 

What has become very apparent is the Christchurch rebuild will take many years but the high amount of resources input from insurance, local bodies, private sector and Government will see a sustained strong Canterbury economy.

23 June 2011

Christchurch Update

The government announcement today has given some of the people in the worst affected areas the opportunity to make decisions about their homes and a choice to move on.  CERA has set up a website to advise on the classification of land.  You can view this site at http://www.landcheck.org.nz/

The aftershocks continue causing some minor damage to properties closer to the epicentres of these events.  The greatest impact is of a psychological nature, people living and working in an environment with a constant level of underlying stress of wondering, where and how strong, the next aftershock will be.

Since September 4, 2010 Cantabrians have experienced over 7000 aftershocks, the resilience showing by the majority of the population is remarkable.  Some of our tenants are struggling to cope with living in Christchurch and are choosing to leave if they can.

We are having requests from some tenants seeking reductions in rent for loss of amenities.  The majority of owners have made concessions where these requests were genuine.   MPM have not been to the Tenancy Tribunal in relation to a loss of amenities hearing, but we have anecdotal reports of some significant rent reductions being ordered.

The Residential Rental Market in Christchurch is in 2 distinctive parts.  The North and Western area has good activity with properties in demand.  The Eastern Suburbs have rental properties available and many with only minor cosmetic damage but with little or no enquiry.   Depopulation is a factor but difficult to define the level and trend.  Canterbury University is projecting a reduction of 1500 students for the 2012 year which could impact on those specialising in student accommodation.

I thank our team who continue to function extremely efficiently in these challenging times in the role of custodian of your asset.  I thank you for your patience and understanding of the process’s we are going through and seek a continuation of this understanding.

Tony McPherson

McPherson Property Management

What we have seen for a while has finally hit the media. Click here to read the article in todays Christchurch Press. 

Would money be better spent on assisting with rent payments or transport costs and encouraging people to rent currently vacant houses?

The next period of future Christchurch is exciting, the ideas and concepts of the rebuild and the level of community participation in this process is pleasing to see.

The appointment of Roger Sutton to lead Cera (Canterbury Earthquake Recovery Authority) is an inspired choice, his personality and action displayed during the restoration of electrical supply services was outstanding.

Whichever way the city evolves in relation to a rebuilt CBD, the future growth trend will be towards the west. Our Ray White – McPherson Group offices are positioned geographically to service this trend.

Initially all the vacant business and retail sites were quickly occupied in the Riccarton – Hornby area, now we are seeing many of the weaker businesses in these areas being replaced by stronger ones relocating from the CBD.

Obviously these relocations are more than a short term solution. How the northern and western commercial areas evolve over the medium/long term is interesting as this will impact further on the residential development west.

Our latest Residentail Sales stats clearly show that sales activity in Selwyn is close to levels of 2007, the trade area of Ray White Rolleston. The north and west, Ray White Metro’s and Ray White Hornby’s trade areas, have recovered to 80% of the pre quake levels and compared with current National sales volumes, excluding Auckland, is not far off the mark.

Tony McPherson