Expectations of house price increases are at an eight year low in Auckland, according to ASB's latest Housing Confidence Survey.
However the survey also shows a sharp divide in house price expectations between the North and South Island, with fewer people expecting prices to rise in the North Island but a lift in the numbers of those expecting them to rise in the South Island, particularly in Christchurch.
ASB Chief economist Nick Tuffley said the decline in price expectations was probably driven by softer market conditions in Auckland, but this had also caused a rise in the number of people who thought it was a good time to buy a property.
Most respondents also expected interest rates to rise over the next 12 months, although that conviction was not as strong as in previous surveys.
Tuffley said muted inflation pressures had pushed out ASB's forecast for the Reserve Bank to increase interest rates.
"We now expect the RBNZ to start lifting the Official Cash Rate in August 2019, though in the meantime offshore interest rate increases could see mortgage rates start to creep up," he said.
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26 Comments
Hi ALL:
I am surprised as to why Housing is called "overpriced"
To my understanding( correct me if I am wrong"
a) House consists of land which is " overpriced" in certain areas due to certain factors.
b) Nobody wants to take on the contracting companies who use substandard material
substandard practices.
c) Nobody seems to take on the Building code which is out of date wrt The World
d) Nobody wants to take on the BRANZ which identifies risky structures eg which are prone to water entry but does nothing to outlaw these practices.
e) In the this last century very few buildings had leak issues within a year of building but now they do. If I bought a house in 1940 at 10000 pounds i was reasonably sure with no act of god or disaster and with reasonable care this would last till 2040 easily
f) To remedy a body corp building we need Body corp committee+MBIE+ Court+ Hobanz+Council+ Builders+ lawyers+ architects+watercare+Railways.
g) we pay NZD800.00 to have Dispute services look at a body corp filing. austrlia
does it in 400AUD to my knowledge
Will someone explain why? I will be most thankful
Your surety for house prices doubling every 10 years is baseless assumption although probably a widely held hope amongst those (especially Aucklanders) who have minimal equity and holding very large mortgages.
Houses in Auckland currently have no fair value in terms of both historical price vs income, and rental yields. For this reason I see house prices as being at the very best flattish for at least the next four to five years of your 10 year period.
Ron would be proud:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=119…
Yvil, just spit it out. Are you seriously implying that house prices are about to take off on the back of cheaper interest rates? Think about it for a moment. Why are interest rates falling in the first place?
First home buyers did well in recent months by simply holding off. Just think how much further their cash savings are going when compared to a year ago. These are encouraging signs - right? FHB will be rewarded for their patience as there are much bigger declines to come. It's now a buyers market - period.
Adjusted for inflation, real estate is right now a lousy performer. Rental yields as low as they are imply there is no risk whatsoever dealing with tenants. Something is about to give.
Anyway, you can take your Real Estate Agents hat off now, you've finished work for the day!
And mid-2008, and mid-2003, and mid-1998. Their house price is higher and there is a chance that they're "better off" in a material sense, particularly if the house price has outstripped their ability to earn and save (which opens up a whole different kettle of fish in terms of the sustainability of an economy and national wealth going forward). It has nothing to do with the "majority advice", which is nothing more than an invention and doesn't exist.
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