NZ WATCH: Housing Market Too Hot, But Big Falls Unlikely
Thursday 4 November 2004
New Zealand's housing market is hot - and even after two years of spectacular gains, it is unlikely to see severe declines in price.
By The Landlord
Despite forecasts that economic growth will slow significantly from the 5.7% expansion for the year to end-June, economists said the rise in housing prices will be held up by fundamental factors, notably a growth in the country's population.A correction is possible - and is even welcome as a way to shake off the recent excesses - but any fall will be limited, they added.
House prices have risen over 35% to a median NZ$250,000 in the two years to September, according to figures issued last month by the Real Estate Institute of New Zealand.
Westpac is forecasting a 5% drop in house prices, based on economic modeling.
"A lot of increases we have seen have been driven by fundamental factors," said Westpac economist Donna Purdue. "In New Zealand it's been driven by the fact that we've had such a big surge in population and all those people have to be housed."
Read More - Opens in a new window
Commenting is closed
House Prices
No stopping Capital price rises
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.
Commercial
NZ proptech start-up scores major investor
Auckland-based commercial property disrupter, Jasper, has raised $2.3 million in seed funding following investment from European asset manager M7 Real Estate.
Mortgages
LVR limits slow down investors
LVR speed limits continue to have a "strong effect" on investors, according to CoreLogic, after the latest Reserve Bank data showed a drop in investor borrowing.
