Winter brings market slowdown
As New Zealand braces for winter, the housing market is showing signs of a significant slowdown.
The latest QV House Price Index revealed only a marginal increase of 0.1% in national home values for the quarter ending April, marking a drastic reduction from the previous quarter’s 2.2% growth.
James Wilson (pictured above), QV operations manager, highlighted the challenging economic conditions impacting the housing sector.
“What little momentum the housing market still had going into autumn appears to have all but evaporated now,” Wilson said. “Home value growth has largely stalled across much of the country, reflecting difficult economic conditions that aren’t getting any easier and aren’t likely to anytime soon.”
Regional variations in market performance
While most regions are experiencing stagnation or declines in home values, with Auckland, Napier, and Hastings seeing decreases, Rotorua, Dunedin, and Invercargill buck the trend with increases of up to 3.6%. However, the sustainability of this growth remains uncertain as the peak real estate season winds down.
Outlook for winter and beyond
The property market is expected to remain in stasis throughout the winter, with little hope for improvement until later in the year.
“Sales volumes are already relatively low and are likely to drop even lower as winter officially sets in,” Wilson said.
Wilson anticipated that any significant recovery will not occur until after winter, with interest rate pressures expected to persist.
First-time buyers gain leverage
Despite the challenging market, first-time buyers may find opportunities due to the surplus of listings and reduced competition from investors.
“Although getting finance and being in a position to service a mortgage in this economic environment certainly isn’t easy, buyers now control the narrative in most areas,” Wilson said. “They have time on their side and plenty of options to choose from.”
For more information, read the regional breakdown of the latest QV House Price figures or find the current value of your home. You can also compare the latest results with the figures from the previous QV report.
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