Property market swings in buyers’ favour

The bank’s demand-supply housing balance measures show that Auckland remains the hottest.

The majority of other regions show pending excess supply conditions. The tight demand-supply balance that has been supportive of the housing market for some time finally looks to be turning. Ultimately, this suggests that house price growth, which has already softened recently, will continue to moderate over the year ahead.

The easing trend in net migration inflows continues, which will take further pressure off the housing market – a development that the Reserve Bank will welcome.

ANZ chief economist Cameron Bagrie sees migration levels pointing to further moderation and flatness in the housing market for the rest of the year.

Reliance on offshore funding makes New Zealand vulnerable to recent global financial market volatility, given record levels of indebtedness and debt servicing.

As well, the year’s interest rate hikes are likely to see demand slow.

The majority of regions are now showing early signs of a market that is set to move in the favour of buyers.

ANZ’s demand-supply indicators suggest roughly balanced conditions in Northland, Waikato and Canterbury.

Supply is exceeding demand in Gisborne, Taranaki, Hawke’s Bay, Manawatu, Nelson/Malborough and West Coast. Wellington also experienced a sharp shift to excess supply conditions in the quarter.

Only the Auckland region is still clearly facing significant excess demand conditions.