A greater choice of properties is opening up for buyers across New Zealand as the real estate market continues to deal with the stubbornly high official cash rate (OCR) of 5.25%.
Astute buyers are showing confidence in the future value of the market, making their move before rates begin to fall.
As a respected agency in your area, we believe we are currently experiencing the healthiest buyer’s market for at least a decade. As evidence, one NZ agency has observed its current stock is at a 13-year high.
This is excellent news for buyers who have the courage to go against the flow. There are opportunities today to find great buying, knowing that the OCR will taper down eventually.
While the Bank of New Zealand has not indicated when it might reduce rates, cuts in similar-style economies, such as Australia and America, are predicted for the middle of the year.
Portal realestate.co.nz listed 11,788 properties in February, almost twice as many as the previous 12 months (+45%). It said listings had not been this strong since the beginning of 2017.
Our agents believe owners looking to upgrade or first-time buyers seeking to break into the market have a rare investment opportunity. But this window will not last forever. Inevitably, rates will come down and prices will move strongly again.
The NZ median selling price was $970,000 in February, a drop of 6.7% compared with December’s number. So, it is clear good buying opportunities exist. If you can handle the financial challenge of the current mortgage rate, then it’s a great time to make your move.
Below, we have listed some buying tips to help inspire you.
Due diligence – Study recent sales data in your target area. Focus on the style of property you wish to purchase. Understanding the market conditions will help you identify bargains and negotiate effectively.
Money question – Before you begin your search in earnest, get a preapproved mortgage. Even in a buyer’s market, good properties will go quickly. Sellers are unlikely to wait for you to get your finances in order.
Be discerning – Conversely, a benefit of a buyer’s market is the luxury of time. If every property flew off the shelf, it wouldn’t be a buyer’s market. So, in most instances, you can take a little more time to make your decision. But you should still have your finances lined up.
Value equation – Don’t focus only on the price. You should also consider the long-term value of the property. Is it in an area where real estate consistently appreciates in value? In the long term, this is a more important question than the sticker price.
Negotiate with purpose – In a buyer’s market, sellers are more willing to pay for fixes to help get you over the line. So, ensure you conduct a thorough property inspection yourself to identify cosmetic issues. Professional building and pest inspections will identify any big issues.