NORTH SHORE MARKET UPDATE

An insight into what is happening in your area.

HAS THE MARKET BOTTOMED OUT?

Over the past month it’s been about the impact of interest rates, immigration & inflation, and the influence they will have on the propertymarket Thequestionis‘Hasthemarketbottomedout?’

Well, if the best predictor of future behaviour is past behaviour, then given the data on significantly increasing immigration it is worthy to review the correlation that immigration and property priceshavehadinthepast.

NetimmigrationfortheyeartoMarchisnowsittingatover65,000 compared to a net loss of nearly 20,000 in the previous year forecastsareforthistogrowtoanetinflowof100,000peoplethis year – this would be the fastest rate of population growth New Zealandhasseenindecades.

As can be seen the increased demand for housing from immigration has in the past put upward pressure on prices Whilst it is generally a ‘lagged relationship’ looking forward it would be sensible to assume this rapidly growing immigration (resulting in the increased demand for housing), at a time when new supply is slowingisagainlikelytoresultinincreasingpropertyprices

Despite subdued sales volumes in April there is undoubtedly growingmomentuminthemarket,firsthomebuyersaremore active, they’ve been assisted by the reserve banks announcement on easing LVR restrictions. Our auction room last week was overflowing andreportsofgoodpropertieshavinglargenumbersofinspections

So,hasthemarketbottomedout?Wewontknowuntilwehavepassed the point! As buyers analyse if inflation & interest rates have peaked, be cautious of the impact of immigration and closely consider the current conditions, with lower prices and a reasonable volume of listingstherearestrongindicatorsthatforastutebuyersitisthetime toact.

Pleasereachoutifyouhaveanyquestions,Iwouldlovetoassist

Untilnexttime,keepsmiling!