The old adage that ‘time flies when you are having fun’ springs to mind when we reflect on the fact that 2019 heralds the passing of twenty years since Tommy’s first commenced business in Wellington City. It hardly seems even half that long since we opened our doors for business! Whilst it has been a combination of fun and hard work, it has also been a particularly satisfying period of time for Tommy’s management and staff, because we have been able to help so many home buyers and sellers realise their real estate dreams. To see so many of our clients enjoying the benefits of homeownership is pleasing, and we can identify many clients who have not only housed and given security of tenure to their families, but who have also acquired sizeable capital gains during this time.

Tommy’s started as a boutique agency with two partners and a single salesperson but quickly expanded their sales team as the market reinforced the identified need for another major player in Wellington real estate. Looking back on our sales records, we are reminded that the company concluded 900 property sale and purchase transactions in the first two years of business. Not bad from a standing start!  Many of the early recruits made by Tommy’s remain with the company today; the blend of their experience with recent additions to the sales team makes a formidable sales force as we embark on another year of service to the public.

With Wellington being the vibrant city that it is, we see no reason why the early months of this year should be any different from what we have witnessed in recent years. January and February have historically been active real estate months with strong enquiry coming from potential homebuyers moving to the capital for enhancement of their business and study opportunities. Demand for rental accommodation will again be strong over this period and will put additional pressure on a supply that is barely adequate to meet demand at this time of the year. This scenario is likely to contribute to an increase in the number of home buyers as property investors see opportunities for securing good tenants at rising rental levels.

The plight of first home buyers in 2019 is unlikely to get much easier. However, those who are in this category can take heart from recent announcements by the governor of the Reserve Bank of NZ. At the November review of the Official Cash Rate (OCR), the current level of 1.75% was maintained with a strong indication that it was unlikely to change in 2019 and possibly beyond that time. This is a good indicator that those entering into mortgage borrowing arrangements can do so with some confidence that there is unlikely to be any significant increase in interest rates in the short to medium term, at least. There will also be a relaxing of the Loan to Value ratios (LVRs) from 1st January which will assist some first home buyers by reducing their personal cash deposit requirements slightly.

Conversely, the final market report from the Real Estate Institute for 2018 was published in mid- December under the caption “Record house prices an early Christmas present to vendors”. The report stated “For two months in a row now we’ve seen record median prices set for New Zealand driven by extremely strong growth in some of the regions where demand for good properties continues to outstrip supply. In fact, prices rose annually in 14 out of the 16 regions the exceptions being Auckland and Canterbury”. Good news for homeowners and home sellers but perhaps not so good for potential home buyers!

Another pre-Christmas press release, this time from the Real Estate Industry’s regulatory body the Real Estate Authority will also be of interest to home buyers and sellers alike. Under the caption, “Complaints against real estate industry at a five-year low”, the report states that there were 337 complaints against licensed real estate professionals in the last year, a reduction of 50% since the year 2013. Less than one per cent (0.85%) of these complaints resulted in a finding of misconduct or unsatisfactory conduct against a licensee. When we reflect on the fact that licensed real estate agents sold in excess of 64,000 residential properties with a value of more than $42 billion in the first 10 months of 2018, the number of complaints is negligible. Adding to this, a further $53 billion in commercial, industrial, rural, lifestyle and business broking sales gives an indication of the significant contribution that the real estate industry makes to the economy.

Tommy’s strongly believes that the level of complaints would reduce even further if there was a nominal fee charged to the complainant with each complaint. This fee would be refundable only where the complaint was upheld by the REA and would eliminate many of the frivolous and vexatious complaints that are currently made to the REA.

We trust that our many clients have enjoyed family time and a holiday break over the past few weeks. 2019 will be another year with opportunities in the housing industry. We invite you to call our sales team and discuss your requirements in confidence. We look forward to being of assistance.

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