Current Housing Market Favours First-Time Buyers, Experts Say
If you’ve been thinking about buying your first home, now could be the perfect time to take the leap.
Experts and commentators alike have said that the current housing market in New Zealand is perfect for first-time homeowners. This market environment is a product of recent amendments to rental property market regulations and relaxed lending legislation.
According to Homes.co.nz, 1508 homes were sold for less than $690,000 in Auckland last year. Similarly, in Hamilton, over 700 properties sold for less than $459,000, the city’s first-time home buyer price. In Christchurch, this number was over 1,000 homes.
Data from CoreLogic shows that for the first time in several years, first-time homeowners made up an equal portion of the property market as investors. Usually, investors make up a much larger percentage of property buyers. Experts have noted that relaxed lending laws (which came into effect earlier this year) and being more willing to compromise are the reasons behind the shift. Stalling and falling house prices have also had an impact, as this provides first-time homeowners with more opportunity to get into the market.
“House prices in Auckland, our largest property market, continue to fall even as incomes across the country increase. However, the most important recent change to first-time home buyers has been the continuing decrease in fixed mortgage rates. Fixed mortgage rates have been driven lower in recent months by lower long-term bond rates and have made the cost of buying a house and servicing a mortgage more manageable,” said Infometrics economist, Brad Olsen.
The government’s decision to rule out a capital gains tax earlier this year has also provided first-time buyers with the confidence to invest in the property market.
All in all, it seems the property market is smiling down upon first-time homeowners with many more expected to take advantage of the favourable conditions.
Thinking Of Buying Your First Home? Talk To The Professionals
Looking to get into the property market? We are here to help. Talk to Wallace and Stratton, the real estate professionals, for expert advice on the real estate industry and help with buying your next home.