NZ homes jump on global roundabout

Monday 1 November 2004

Some New Zealand homes are now part of the global property market - and overseas buyers willing to pay more are driving up prices.

By The Landlord

Property prices have risen about 50 per cent in the past three years, which some economists argue is justified by economic growth, lower unemployment and rising wages.

But part of the increase may be overdone and the market is set for a fall, other economists warn.

A Massey University senior lecturer in real estate, Graham Crews, said it was "hard to predict any sort of property crash" because of the strong economy, low unemployment and strong export prices.

Overseas buyers had been pushing up property prices in some areas - even for "bread-and-butter" homes, he said.

"Migrants have been a major driver in prices, where New Zealanders have just stood back, aghast."

Migrants would base the price they paid on the exchange rate and their job prospects, and compare what they got in New Zealand with elsewhere.

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