DOWNWARD PRESSURE – HAS THE MARKET TURNED?
Simple economics have changed quite suddenly in the housing market and players across the spectrum are picking price rises of just 2-4% this year after a massive 29% surge last year.
This spectacular growth is unlikely to be seen again for another generation, says David Nagel, QV general manager.
“With interest rates rising, tightening credit conditions and supply pressures easing, the property market is returning to a more sustainable level of growth,” he says.
The sharp slowdown in growth is biting. There are fewer buyers in the market, listings are rising and new builds are coming unstuck as buyers will no longer pay what developers want because access to money is fraught and LVRs are biting.
An adjustment to house prices is underway, says Tony Alexander, former BNZ chief economist and now an independent. “Vendors still holding out for the big prices are having to capitulate to lower offers from buyers.”
Barfoot & Thompson, one of the biggest auctioneers in the country, has sold less than half the properties for auction under the hammer this year, and the
