Property prices above expectations – realtor owner

by Roxanne Libatique10 Sep 2020

Century 21 New Zealand owner Derryn Mayne reminds property buyers that waiting for house prices to fall might hit a dead end as most regions are now seeing property prices above expectations.

“Waiting for house prices to fall may not be the best strategy for those keen to buy, with most regions now seeing properties flying out the door and many houses fetching well above any asking price or expectation,” Mayne said.

Her comments follow the latest survey by the Real Estate Institute of New Zealand (REINZ) and independent economist Tony Alexander, which revealed that more people are attending auctions and open homes despite a short supply of listings.

As a result, fewer investors believe that they will find bargains, fewer buyers retain fears that prices will fall, and a net 81% of agents expect property prices rising.

Read more: New Zealand's economy is doing better than expected — ASB

Mayne noted economists' previous expectations that prices will fall due to the impacts of the COVID-19 pandemic, but many are now revising their “doom and gloom” forecasts.

“Our COVID-19 economy has certainly got a long way to go, and the market has been somewhat insulated by the likes of the wage subsidy and mortgage holiday schemes. However, most of our offices in regional New Zealand could not have foreseen such a buoyant spring. It will certainly help set up plenty of activity this coming summer,” Mayne said.

Agents also reported people keen to move out of the cities, with coastal and lifestyle properties becoming popular in the current environment.

“Many people now realise they can work from home very effectively and in many cases more productively and for cheaper. Subsequently, we're seeing people selling up in the bigger cities, freeing up a bit of equity, and opting for an easier lifestyle with more space and fewer people,” Mayne said.

“What's more, no overseas holidays in the foreseeable future see more Kiwi families looking at holiday houses and baches instead, knowing that strong domestic travel will give them good ‘bookabach’ income too.”

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