“Change is the law of life, and those who look only to the past and present are certain to miss the future” -John F. Kennedy
The times, they are a-changing.....we live in uncertain times. And yet everyday I am asked..."What is the market doing?". The answer is always the same. The market is doing what the market does...changing everyday according to a variety of factors/conditions/influences and also depending if you are a buyer or a seller.
Even just overnight, the Real Estate landscape has changed again rather rapidly as we witnessed the end of the "Kiwi-build" fiasco being announced along with the (re)introduction of the 5% deposit for new home buyers and many other strategies to encourage new buyers into home ownership. This is welcome news for those previously locked out of home ownership. It it is a massive change for the local property landscape, a significant change overnight which will see many more buyers entering the home ownership buyer pool and demand for suitable homes may outstrip supply in the short term, creating higher prices for sellers of these types of "first" homes in good locations.
Another change is the regional statistics just released this week showing massive changes in prices in some regions and towns over just one year with some Taranaki Towns seeing exceptional growth in sale prices in one year (Waverly, Opunake and Inglewood spring to mind) but also solid increases in most other regional towns.
Many factors impact on our local prices and local property demand. Here are some positive and negative changes (national, regional and local) currently influencing the property market:
The Capital Gains Tax not being introduced
The Bright-Line test not being extended
Inward migration continuing
Job numbers up and unemployment down
Some banks reducing the test % interest rate threshold (serviceability of mortgage)
Reserve bank easing LVR ratios
Banks strict lending criteria will continue to influence home ownership.
Interest rates are very low
Uncertainty surrounding the detail of newly announced First Home grants and other incentives for low income and first home buyers.
The international Green School is locally creating demand for quality homes
Spring arriving always creates more buoyancy in the market
Global instability and uncertainty (more kiwi's returning)
NZ business pessimism still high
A shortage of builders and construction workers
Low income and first home affordability in some cities
Less rental property available due to legislation changes and other factors that have discouraged landlords
High rental property demand
Empty-nesters are leaving spacious family homes and seeking smaller, nicer, well located homes
Consumer confidence is low
Credit card and other personal debt remains high per capita
Economic growth is slowing
Borrowing has been difficult/challenging for those who have less common situations
Locally...an under-supply of smaller/low maintenance homes for couples downsizing, small families and also affordable family homes for first home buyers.
(Source: NZ Herald, Monday 2 September 2019, articles by Tony Alexander, One Roof).
So to answer to the question"what is the market doing" really depends on what day you ask the question. The answer really is that "the market is always changing" day by day, and hour by hour. The market is the market...it will always be changing. Two more important questions perhaps are "What is my property goal? followed by "Who can help me do that?" If you focus on these questions, you will be well on your way to success with achieving your goal, regardless of the "market" you find yourself in.