The upcoming election and the loan- to-value restrictions (LVRs) imposed by the Reserve Bank have cooled the New Zealand property market, with the average asking price remaining relatively unchanged since last month, according to the latest Trade Me Property Price Index.
The Property Institute of New Zealand has announced its support to the decision to take debt-to-income ratios off the table as a tool available to the Reserve Bank.
In a recently held press conference, Prime Minister Bill English said that the Government will not give the Reserve Bank the authority to use the tool and that there is no need for the regulator to use extra tools.
Lifestyle properties sold in the last three months have registered a 19.2% fall, according to a report from the Real Estate Institute of New Zealand.
The report showed that 1,984 lifestyle properties sold in the three months ended in July, down by 471 from a year ago.
The Real Estate Institute of New Zealand (REINZ) has called for a review of the current loan-to-value ratio limitations, as its latest data has revealed a significant drop in the number of properties sold nationwide last month.
The data found the number of sales across New Zealand in July fell by a quarter (24.5%) when compared to the same time last year, and the number of properties sold in Auckland fell by 30.6% (for the same period).
ASB economist continues to forecast a healthy economic growth outlook for New Zealand, but housing market has slowed down and business is predicted to be in a goldilocks condition.
According to the latest ASB uarterly economic forecast, the housing market, particularly in Auckland, is “losing steam.” Volume of house sales fell by 30% over the last year. Affordability challenges, additional loan restrictions, lifts in mortgage rates and reduction in the “fear of missing out” will be key drivers of the slower market conditions, ASB chief economist Nick Tuffley said.
Statistics NZ says there was a rise in consents issued in the year ended June 2017
The total number of new houses, townhouses and flats that were consented in the 12 months to June 2017 was 30,453, a rise of 4.7% from the previous 12 months. But even with the rise, there will still be a supply shortage.
The Government will co-invest up to $600 million, alongside local councils and private investors in network infrastructure, for new housing developments through a re-purposed ultra-fast broadband company, according to latest report from the New Zealand government.
Crown Infrastructure Partners, formerly Crown Fibre Holdings, will attract private investment for roading and water infrastructure to support the timely increase of housing supply.