ARTICLE SUPPLIED BY BRUCE PATTEN, LOAN MARKET
The global economic outlook may still be gloomy, but that doesn’t seem to have dampened the NZ property market. According to REINZ, house prices across the country increased by 9.2% compared to June 2019. New property listings also increased nationwide, up by 19.7% on the same time last year says realestate.co.nz and REINZ reports the number of properties sold nationally increased by 7.1% – the best result for a June month in over four years.
These results have surpassed the expectations of even the most optimistic of commentators during the lockdown. The NZ property market has surpassed the expectations of even the most optimistic commentators. The latest data confirms the property market has continued to bounce back after lockdown.
Across the country, house prices are up, new listings have increased and the number of homes sold has also improved. The data has led realestate.co.nz to declare that it’s now a buyer’s market in Auckland, Nelson & Bays, Canterbury and Central Otago/Lakes.
No doubt falling interest rates, the removal of loan-to-value ratios and demand from the large number of returning Kiwis have had an impact. So too has the government’s wage subsidy and mortgage holiday schemes.
However, the global economic outlook is decidedly gloomy. The resurgence in Covid-19 cases in Australia, Europe and the US is casting a dark shadow over the world economy. Although so far, NZ’s economy is in reasonable shape, we are bound to be affected by any large-scale global downturn.
Furthermore, the election is now just a few weeks away. National elections tend to have a dampening effect on property markets as owners and buyers adopt a wait and see approach.
The wage subsidy and mortgage holiday schemes are due to end shortly. Both have had a cushioning effect on the post-lockdown property market. However, Finance Minister Grant Robertson has hinted that the programmes may be extended, perhaps to the end of the year – so watch this space.
Here’s a run-through of some of the critical property market data.
Business commentators are still predicting more job losses as government wage subsidies come to an end. And if unemployment rises, then banks are likely to tighten their lending criteria even further.
As we head towards the September election, we may see the market slowing down in the face of the political and economic uncertainty.
If you are thinking about buying or selling your home then get in touch, I’m only a phone call away.
This article was supplied by Bruce Patten, a Loan Market mortgage broker since 2002 who has written over $1 Billion in home loans for his client and is considered one of the most experienced mortgage brokers in Auckland.Bruce is always on hand to answer any questions you may have about loans or anything around the loan process. Get in touch with him anytime by phone (021 661 114) or email (email@example.com).