What downturn? Market Heating up again
The Current Property Market
Out of 71 Districts, 64 are only trending one way over the last quarter - and all except for the Auckland Districts and Whangarei have been trending that way for at least the past 12 months.
In the last quarter, values are up as follows;
Auckland 1.3% (North Shore-Onewa was up 2.5%)
Wellington 3%
Christchurch 1.7%
Dunedin 8.6%
Invercargill 9.3%
Gisborne 6.7%
Rotorua 4.5%
Regional/Provincially, it's the same story - nearly every single one showing growth but as examples, the Southland, Mackenzie, and Waitaki Districts were up 5.6%, 9.4%, and 6.3% respectively.
So, nothing new here right?
Hmmm, well no actually, the fact that Auckland has gone into positive value growth territory (off the back of a 12-month drop in values of 1.2%) suggests that the low-interest rates, strong employment, very strong demand v supply, easier servicing rates being used by lenders and potentially, the first home buyer deposit requirement reducing to 5% (coupled with Spring - which, for the record comes every year but still takes people by surprise), has resulted in sustained/stronger demand and confidence.
As many now wind down for the year and the Christmas and early January relaxation and holiday focus creeps in, it will be of interest to see whether the trend continues into the New Year.
If I were a betting man - and this is just an opinion based on what I read, see and hear - I just can't see any significant downturn - not because I want to drive the perpetual belief that prices will continue to go up (but they seem to), not because I don't think families are doing it hard (I have 3 school-age kids and again a mortgage) and not because I don't believe there are domestic and global headwinds that may cause some wobbles, but fundamentally because, when it comes down to it, having a roof over one’s head is a basic need which drives demand for homeownership or renting but it's a demand either way.
And, right or wrong, investors can't see past bricks and mortar (and the banks like this type of security too…) versus other investments or the returns from having money in the bank…
Happy winding down week folks.
Go the Black Caps.
Paul
#wemaynotlikeitbutthefactsarethefacts
#pauldowknowhow
