As we head into winter, the New Zealand housing market is full of mystery and intrigue.
Trying to find the perfect time to buy and sell a home has rarely been harder if you believe you can read the tea leaves of our real estate market.
We’ve been helped by the recent 0.25% cut in the Official Cash Rate (OCR) to 3.25% with a range of economists now only discussing whether it could fall to 2.5% by the end of the year.
Right now, we’re in a situation that favours the buyer, but that should not necessarily overly influence your property decisions.
More important factors should come into play. Most significantly, the decision to buy and sell should reflect your own personal circumstances of when you are ready to transact.
If you have a growing family and wish to upsize, or you want to buy your first home, then the timing around your decision should be based on these factors.
Likewise, if you wish to downsize because you’re getting to a certain stage in your life and your home is becoming unmanageable, then the challenges of this scenario may take priority over discounting your price to strike a deal and move on.
There are a number of factors influencing our market currently. Predominantly, buyers are taking their time, and prices are under pressure because of the significant rise in homes for sale (estimates suggest that number is anything from 36,000 to 44,000).
Even with the rate cuts by the Reserve Bank of New Zealand, Kiwis are still facing confidence challenges related to the nation’s economic recovery.
Meanwhile, investors have excellent buying opportunities in certain parts of the country – Wellington has seen price falls in the last few months – but finding tenants is not as easy as 12 months ago.
The latest OneRoof-Valocity House Value Index says values have remained static at $970,000 – just a +$7,000 difference on figures from May 2024.
While many centres have edged up or down this year, the big movers at either end of the spectrum are Wellington (-3.7%) and Queenstown-Lakes (+2.2).
Public sector job losses have hit Wellington pretty hard.
The OneRoof-Valocity figures reflect positive movements in smaller markets over the past three months. For example, Gisborne (+1.7%), Southland (+1.4%) and West Coast (1.2%) are enjoying a stable market, together with Tasman (+3%) and Marlborough (+1.8%)
The report finds that while the number of new listings is slowing, it’s still around the 44,000 mark, which is up 7% from a year ago.
If you think this should all add up to a more affordable market, you might be surprised. OneRoof says homes are an average $200,000+ more expensive than in 2020.
Our bottom-line advice is pretty simple – prioritise your personal circumstances and desires in deciding when to transact. And for sellers, give your prospective buyers a five-star experience to maximise the value of your home.