Bank of New Zealand (BNZ) stories
Rising mortgage costs and tighter lending rules are expected to cool the market, even after values posted their first monthly acceleration in six months.
Higher mortgage rates and tighter lending rules are already cooling New Zealand’s housing market, with investor demand slipping further.
Property values rose 1.4% nationally in September, but activity is easing as tighter lending and higher rates weigh on buyers.
Higher mortgage costs are unlikely to deter first-time buyers while rents keep climbing and remain above many monthly loan repayments.
Homeowners face higher rebuild insurance bills as labour and materials shortages pushed residential construction costs up 2.2% in June.
Westland is the country's most affordable area, with house prices at just 3.2 times income and rent and deposits well below national norms.
Property deals are being slowed by fresh restrictions, but Colliers expects demand to recover quickly once alert levels ease.
Affordability pressures are starting to bite, with Hamilton and Rotorua both posting quarterly falls after a rapid run-up in values.
Nearly all New Zealand homes sold for a profit in the June quarter, as record-low mortgage rates and tight listings drove gains.
Borrowers face higher repayments and tighter credit as rate rises, though lockdown likely postpones the Reserve Bank’s next move.
Borrowers face tighter lending rules as the Reserve Bank moves to curb risky loans amid house values rising 1.8% in July.
Rising mortgage rates and tax changes are set to cool sales, but CoreLogic says a full property downturn still looks unlikely.
New records in prices and sales show demand is still outpacing supply, despite efforts to cool New Zealand's property market.
Stronger-than-expected demand is tightening yields and lifting values, with industrial and large-format retail assets in New Zealand most resilient.
Values are already falling in Gisborne, New Plymouth and Napier as nationwide house-price growth cools and rate rises loom.
Record-low inventory is pushing New Zealand house prices higher, leaving first-time buyers with fewer affordable options.
Rising lending restrictions and tax changes are already cooling demand, though some agents say Treasury’s flatlining forecast may be too gloomy.
Sales fell 28% in April and the median price eased to NZD $810,000, but analysts say it is too soon to judge the policy impact.
Government help may be needed as first-time purchasers’ share of the market falls to its lowest level since 2018, CoreLogic says.
Signs of cooling are emerging as quieter open homes and more auctions passing in are expected to slow gains after a red-hot year.
