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JAN 17 2019
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What’s the outlook for New Zealand property market in 2019?

Posted by: Connie in Property Investing


You might have heard the concern about a drop in Auckland property market from some property strategists. But wait, these news and press might be just too overwhelming, and would have you surrender…Few of these stories come out the true stories.


Let’s see the figures on 2018 property market

The priciest parts of Auckland suffered the most price weakness over the past year.

In Auckland, prices were down 0.4% in December compared to December 2017. In Wellington, they were up 7.4%, in Dunedin up 11.2%, Tauranga up 3.9% and in Hamilton, up 5%.

There were many factors contributing to this downturn. These included restriction on non-New Zealand residents buying certain categories of property, stagnant wage growth, and particularly, the main factor was the government changed, which resulted to the policy changing and uncertainty 


Don’t panic over falling house price in New Zealand, especially in Auckland

If you look back at 2008, it was quite surprising and uncommon that the house prices in New Zealand rose 81% from 2008 to 2018. The data shows us the average house price increase 10% – 20% per year in some major centres and particularly in Auckland.

I believe the surge and subside in the property market has always gone through cycles. The runaway growth could not continue permanently. In other words, striking the bottom won’t be forever. It just needs time.

One fact needs to be noticed is Auckland housing market have high level of demand and still have insufficient supply.

Last November in 2018, mortgage interest rates war intensified. Hot on the heels of 3.95%, one-year mortgage rate offer, ANZ has reached the lowest lending interest rates on record. BNZ has unveiled two year 3.99% loan rate as mortgage wars intensified. Even this special offer just appeared within few weeks, the interest rates came back to around 4.05% afterwards. It’s still a good momentum as interest rates aren’t expected to fly through the roof back to the pre-2007 levels.

Will average house prices in New Zealand go up, down or stabilise? I believe we might expect the similar patterns to 2018, with 3-5% average prices rising. To those sophisticated property investors, I think you might need to have a look at the following factors. The housing price varies in different trend across all over the New Zealand. I expect the 2019 housing price in Auckland will keep the similar slight dropping trend with 2018, while some other major centres will keep uprising trend. What's more, I believe the opportunistic will no longer take instant equity, not like in the past, there were some of home sellers who were intended to sell their home into the market quickly. Renovating your house will be a smart and brave way if you have exceptional insight to catch the quick potential capital growth opportunities, such as the good location of the house, even though it might look not satisfying or smelly at the first sight.


Disclaimer: The content in this article are provided for general situation purpose only. To the extent that any such information, opinions, views and recommendations constitute advice, they do not take into account any person’s particular financial situation or goals and, accordingly, do not constitute personalised financial advice. We therefore recommend that you seek advice from your adviser before taking any action.


TALK TO US NOW! 

Phone: 09 930 8999 

Email: support@profin.co.nz


    

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You might have heard the concern about a drop in Auckland property market from some property strategists. But wait, these news and press might be just too overwhelming, and would have you surrender…Few of these stories come out the true stories.


Let’s see the figures on 2018 property market

The priciest parts of Auckland suffered the most price weakness over the past year.

In Auckland, prices were down 0.4% in December compared to December 2017. In Wellington, they were up 7.4%, in Dunedin up 11.2%, Tauranga up 3.9% and in Hamilton, up 5%.

There were many factors contributing to this downturn. These included restriction on non-New Zealand residents buying certain categories of property, stagnant wage growth, and particularly, the main factor was the government changed, which resulted to the policy changing and uncertainty 


Don’t panic over falling house price in New Zealand, especially in Auckland

If you look back at 2008, it was quite surprising and uncommon that the house prices in New Zealand rose 81% from 2008 to 2018. The data shows us the average house price increase 10% – 20% per year in some major centres and particularly in Auckland.

I believe the surge and subside in the property market has always gone through cycles. The runaway growth could not continue permanently. In other words, striking the bottom won’t be forever. It just needs time.

One fact needs to be noticed is Auckland housing market have high level of demand and still have insufficient supply.

Last November in 2018, mortgage interest rates war intensified. Hot on the heels of 3.95%, one-year mortgage rate offer, ANZ has reached the lowest lending interest rates on record. BNZ has unveiled two year 3.99% loan rate as mortgage wars intensified. Even this special offer just appeared within few weeks, the interest rates came back to around 4.05% afterwards. It’s still a good momentum as interest rates aren’t expected to fly through the roof back to the pre-2007 levels.

Will average house prices in New Zealand go up, down or stabilise? I believe we might expect the similar patterns to 2018, with 3-5% average prices rising. To those sophisticated property investors, I think you might need to have a look at the following factors. The housing price varies in different trend across all over the New Zealand. I expect the 2019 housing price in Auckland will keep the similar slight dropping trend with 2018, while some other major centres will keep uprising trend. What's more, I believe the opportunistic will no longer take instant equity, not like in the past, there were some of home sellers who were intended to sell their home into the market quickly. Renovating your house will be a smart and brave way if you have exceptional insight to catch the quick potential capital growth opportunities, such as the good location of the house, even though it might look not satisfying or smelly at the first sight.


Disclaimer: The content in this article are provided for general situation purpose only. To the extent that any such information, opinions, views and recommendations constitute advice, they do not take into account any person’s particular financial situation or goals and, accordingly, do not constitute personalised financial advice. We therefore recommend that you seek advice from your adviser before taking any action.


TALK TO US NOW! 

Phone: 09 930 8999 

Email: support@profin.co.nz


    

Tags: