Hot property markets in regions could see more homeless

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1 NEWS

Median house prices have hit records in four regions as many of New Zealand's small towns enjoy big returns from the country's skyrocketing property market.

But it could lead to more people sleeping rough in the regions.

Kawerau is one town basking in a booming property market.
Source: 1 NEWS

Data from the Real Estate Institute of New Zealand shows the median sale price in Northland up 16 per cent, Waikato and the Bay of Plenty up 26 per cent and Central Otago up a staggering 32 per cent on July last year.

ONE News went to the Bay of Plenty town of Kawerau where real estate agents say house prices have increased by almost 40 per cent in the last year.

"A few years ago house prices ranged from 50,000 to 200,000. Today you're talking about between 160,000 and 500,000," said Sneha Gray, a real estate agent working in Kawerau. 

The hot property market has seen the number of real estate agencies in the town rise from one a year ago, to four now.

Locals in Kawerau are confident the region's success will boost the local economy too.

"More shops might start opening again," one woman said.

Kawerau mayor Malcolm Campbell says people are getting out of the cities, Auckland and Tauranga in particular, and "cashing up".

However the town's popularity may come at a cost, with higher housing demand potentially leading to higher numbers of homeless people.

Mr Campbell says people are starting to find it very hard to rent in the town.

"A lot of people are coming here and they're buying a house to live in themselves rather than rent it out," he said.

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