New Zealand housing market has entered upturn, CoreLogic says
The median value is now NZ$812,195
[WELLINGTON] New Zealand’s housing market has entered its next phase of growth as lower interest rates begin to stoke demand and drive up prices, according to property agency CoreLogic.
Prices rose 0.5 per cent in March, the strongest increase since January last year, CoreLogic New Zealand said on Thursday (Apr 3) in Wellington. That follows a 0.4 per cent gain in February and a flat result in January, it said.
The March result “builds on the previous month’s rise, signalling the next phase in New Zealand’s property market has begun”, said Kelvin Davidson, chief property economist at CoreLogic in Wellington. “With signs becoming clearer that the economy has started to turn a corner, confidence is returning to the property market.”
The Reserve Bank of New Zealand has reduced the Official Cash Rate by 175 basis points since August to 3.75 per cent, and is expected to deliver another cut to 3.5 per cent next week. The economy exited recession at the end of 2024, posting stronger-than-expected growth in the fourth quarter.
Davidson said it was always going to take some time for lower borrowing costs to flow through to house prices, while an abundance of listings has been an extra factor weighing on values. However, the lags have now worked their way through the system, he said.
“That said, a fresh boom in house prices seems unlikely, given additional restraints that are now in place, such as caps on debt-to-income ratios for mortgage lending,” Davidson said.
March house prices were 3 per cent lower than a year earlier, today’s report showed. The median value is now NZ$812,195 (S$626,742). BLOOMBERG
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