Bollard says residential house prices may fall
Monday 6 September 2004
Reserve Bank Governor Alan Bollard today warned residential property investors to be wary about possible falls in house prices in the next couple of years.
By The Landlord"In housing, as with any other investment, it's the investor who takes the risk, thus it's the investor who needs to be careful," Bollard said in speech notes.
However, Bollard was careful to state that the Reserve Bank was not forecasting "a calamitous fall" in house prices over the next few years.
"A reasonable view is that house prices are unlikely to rise much further over the next two years, and some falls are certainly possible, particularly in some regions," he said.
He said some of the key drivers of the nationwide property boom were easing, such as rapid population growth.
Bollard's speech was for a New Zealand Property Council conference in Rotorua today, and ahead of his monetary policy statement on September 9.
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There’s no sign of a slow-down in Wellington’s property prices with Trade Me Property’s latest data showing that asking prices continue to rise solidly.
Vacancy rates in the commercial property sector are set to increase as changing economic conditions dampen demand.
Take note, investors: It is "quite possible" fixed rate mortgages have hit their lowest point in this cycle, according to economists at ASB.