No surprised faces here: Auckland house prices are still expensive and anyone who’s still waiting for the bubble to burst has missed out on huge capital gains.
The expected March rebound wiped out any temporarily flattened data, in part because people with flash houses put them on the market in February (then everything goes quiet between June and August before listings heat up again in September).
With talk of the OCR dropping even lower, possibly hitting 1.75% or even lower this year, the Reserve Bank may be looking at other ways to cool Auckland house price growth. This may mean more targeted Auckland-specific LVR restrictions or tighter lending restrictions for banks so they need to hold more capital.
ANZ is “wondering whether non-Auckland investors are set to come into the firing line,” which could be a concern if you’ve been looking at making your deposit go further in the regions like so many of our clients. Any restrictions could come into place rapidly, so it may be worth getting your pre-approval in place if you’re shopping for property.
FUZO Property feel that with strong demand from the continued success of our city, under-pinned by migration, with solid job creation, and strong under-supply, that Auckland house prices will continue to rise. Whilst supply is increasing, it has been from a very low base, and the current supply doesn’t keep up with existing demand, let alone pent up demand. With interest rates at record lows, and tipped by us and many leading economists to go lower, we can only see Auckland house prices rising further over at least the next two years.
See FUZO Property’s Head of Strategy talk to the Business Editor of the New Zealand Herald, Liam Dann, and Auckland Council Chief Economist, Chris Parker about where he picks Auckland house prices to head on the David Whitburn on the NZ Herald Economy Hub as sponsored by HSBC.