Market shifts boost investors' hopes
There are early signs that new investors are re-entering New Zealand’s property market, according to Kelvin Davidson (pictured above), CoreLogic’s chief property economist.
“There are tentative hints... that mortgaged MPO 2’s – i.e. people who own two properties after their latest purchase – might just have started to eye up the housing market again,” Davidson said.
The playing field has been leveled due to recent changes in tax rules and mortgage interest deductibility.
Movers preparing for a market comeback
Davidson also noted that while movers have been relatively quiet, a comeback could be on the horizon.
“A weak market can be a good time to move up the ladder," he said, explaining that movers could take advantage of market conditions.
Downsizing remains a key trend, though upsizing has also gained popularity in 2024.
First-home buyers continue to thrive
Despite market fluctuations, first-home buyers (FHBs) remain resilient, representing a significant share of the property market in 2024.
“They always tend to ‘find a way,’” Davidson said.
With the help of KiwiSaver and low-deposit lending allowances, FHBs are well-positioned to maintain their presence in the market for the rest of the year.
Positive outlook for investors and movers in 2024
Looking ahead, Davidson expects small investors and movers to become more active.
As mortgage rates and rental yields narrow, he anticipates that “mum and dad investors” will return to the market.
Davidson also predicted that pent-up demand among movers will result in increased activity over the next 12-18 months.
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