Investors and first-home buyers emerge
A new NZHL Property Report by Tony Alexander (pictured above) revealed a steady rise in buyer activity, with investor interest in residential property bouncing back and first-home buyer demand remaining solid.
The survey, drawing on insights from 283 real estate agents across New Zealand, paints a picture of a stabilising property market with renewed buyer confidence and increasing auction attendance.
Investors show strong interest in property market
The survey indicated a surge in investor interest, with 43% of agents reporting more investors seeking purchases. Falling interest rates and expectations of rising prices are key motivators.
This marks the strongest interest from investors since November 2020 and reverses the previous decline observed in mid-2023.
Investors, according to the agents, are also driven by hopes of finding bargains and benefiting from anticipated market growth.
First-home buyers remain active despite limited price pressure
First-home buyers continue to be a force in the property market, with 56% of agents noting a rise in activity from this group. However, as the number of properties for sale also increases, price pressure remains balanced.
Rising property appraisals, with 58% of agents seeing more valuation requests, suggest that both buying and selling activity are picking up.
Balanced market conditions without a boom
With more people attending both auctions (up 30%) and open homes (up 52%), the market is seeing steady growth, though not a sudden boom. This is the fifth consecutive month of increased auction attendance, signaling stabilised interest at healthy levels.
Prices are also beginning to rise slightly, with a net 8% of agents reporting increases – though far below the peaks of early 2023.
FOMO and FOOP even out
Buyer sentiment remains cautious but optimistic, with 19% of agents seeing signs of FOMO (fear of missing out) and an equal percentage observing FOOP (fear of overpaying).
Alexander noted that, while buyers recognise market improvements, they aren’t rushing to buy, maintaining a balanced outlook as conditions improve.
Minimal offshore interest as domestic demand drives market
Offshore interest in New Zealand’s property market remains subdued, with 15% of agents noting reduced enquiries from abroad. Instead, local demand, fueled by favourable borrowing conditions and attractive property prices, is the primary driver of the current market uptick.
Income and finance accessibility still top buyer concerns
Buyer concerns continue to center around financing and job stability.
Access to loans remains a challenge for many, though worries about rising interest rates have nearly disappeared, with only 1% of agents mentioning rate concerns.
The focus has shifted to income stability, as rising unemployment affects buyer confidence.
Investor sell-off steady amid rising costs
The number of properties put up for sale by investors remains stable, likely due to rising expenses such as insurance and council rates.
For some, these pressures, along with a natural inclination to capitalize on their assets for retirement, are key factors driving sales.
Sustainable growth ahead
The NZHL Property Report indicates a healthier, more sustainable market recovery, driven by local demand and stabilising prices. With first-home buyers and investors showing interest and auction and open home attendance growing, the New Zealand property market is positioning itself for gradual, sustainable growth.
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